{"id":601377,"date":"2023-01-26T06:49:41","date_gmt":"2023-01-26T12:49:41","guid":{"rendered":"https:\/\/news.sellorbuyhomefast.com\/index.php\/2023\/01\/26\/theres-no-such-thing-as-affordable-housing\/"},"modified":"2023-01-26T06:49:41","modified_gmt":"2023-01-26T12:49:41","slug":"theres-no-such-thing-as-affordable-housing","status":"publish","type":"post","link":"https:\/\/newsycanuse.com\/index.php\/2023\/01\/26\/theres-no-such-thing-as-affordable-housing\/","title":{"rendered":"There\u2019s No Such Thing as Affordable Housing"},"content":{"rendered":"
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Back in October, LAist<\/em> reported<\/a> that over the past decade, Los Angeles lost eight times more affordable housing units than it gained for its lowest-income residents. According to city records, from 2010 to 2019, 110,000 houses and apartments affordable to low earners were lost, while only 13,000 were built.<\/p>\n

\u201cAffordable,\u201d in this case, means costing no more than 30% of such a household\u2019s gross income\u2014a standard typically used by federal and non-profit housing programs. Statistics like this go a long way toward illustrating the precarity and hardship faced by the working class in high-cost cities like LA that have failed miserably to get a handle on their housing crisis<\/a>.<\/p>\n

Statistics like this can also mislead. The obvious follow-up question to the statement, \u201cLos Angeles lost 110,000 affordable units,\u201d is the answer to the question, \u201cSo where did they go?\u201d And I have routinely seen casual observers of the housing crisis misunderstand the answer or make incorrect assumptions.<\/p>\n

Were they demolished?<\/p>\n

Were they replaced by high-end units?<\/p>\n

Were they sucked into space by an alien ship with a tractor beam? (Okay, I haven\u2019t seen any casual observers suggest this.)<\/p>\n

The answer is right there in the LAist<\/em> article, but it\u2019s a few paragraphs deeper. While some were presumably physically demolished, replaced, or renovated, the vast majority were \u201clost to higher prices.\u201d The house or apartment didn\u2019t go anywhere; the rent just went up.<\/p>\n

Housing economists call this \u201cfiltering\u201d: the process by which a housing unit moves into a different price tier and houses a different type of resident. Homes can filter up, or they can filter down. Historically, down was the predominant direction\u2014homes and often whole neighborhoods, as they aged, tended to become cheaper (in relative, often not absolute terms) and to be occupied by residents of a lower socioeconomic strata. Research by Freddie Mac<\/a> has found that in the 2010s, in high-cost cities like Los Angeles, the overall direction of filtering switched from down to up. That\u2019s the story LAist<\/em> is observing in a nutshell.<\/p>\n

These shifts in price without any physical change to the housing stock <\/em>are by far the biggest part of the affordability story. They dwarf the impact of actual new construction. Affordability for the masses will live or die not by what we build this year or next, but by what happens to the price of homes that already exist, in which the vast majority of people live.<\/p>\n

Cruel Musical Chairs<\/h2>\n

An extremely commonly heard claim, in cities across North America, is \u201cThere isn\u2019t an overall shortage of housing. There is only a shortage of affordable<\/em> housing.\u201d<\/p>\n

This sort of claim is frequently backed up by data such as this, from the National Low-Income Housing Coalition\u2019s annual \u201cThe Gap<\/a>\u201d report: The NLIHC reports that for every 100 extremely low-income households, there are only 36 affordable rental homes available. For 100 merely low-income households (50% of the median income), there are 58 rental homes they can afford. For moderately low incomes, there are 93, and for households at or above median income, there are 101 apartments for every 100 households.<\/p>\n

A fair summary of this data is that there are enough rental units out there that are affordable to the middle and upper classes, but not nearly enough that are affordable to the working class or the poor.<\/p>\n

This feels<\/em> like a damning observation. In terms of the human suffering it points to, it is. But it\u2019s also a really mundane, obvious one.<\/p>\n

One of the best metaphors for the housing market is a gigantic game of musical chairs. You know, the kids\u2019 party game where there are more people in a room than chairs for them to sit in, and when the music stops playing, everybody runs to claim a chair. Those who end up chairless are out of the game.<\/p>\n<\/div>\n

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