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HUD Archives: News Releases

HUD No. 99-48
Further Information:For Release
In the Washington, DC area: 202/708-0685Monday
Or contact your local HUD officeMarch 8, 1999


Click here for full report.[NOTE: report no longer available on-line. Please call 1-800-245-2691 or visit http://www.huduser.org for information on ordering the report.]

WASHINGTON - The strong economy that has improved the lives of most Americans has hurt some of the poorest families by worsening the crisis-level shortage of affordable housing, according to a new Department of Housing and Urban Development report.

Secretary Andrew Cuomo today released the report - called Waiting In Vain: An Update On America's Housing Crisis. The new report shows that: 1) The time families spend on waiting lists for HUD housing assistance has grown dramatically. 2) Market rents are rising faster than the incomes of poor people. 3) The number of affordable housing units is falling.

The report documents the ongoing shortage of affordable housing in America from 1996 to 1998, updating a report that was based on 1995 statistics.

"The rising economic tide is raising many boats, but it is also drowning some," Cuomo said. "As an unintended consequence of this amazingly strong economy, there is less affordable housing stock and the prices are beyond the reach of those at the bottom of the income spectrum."

The report found that:

  • Time people spent on waiting lists to get into HUD-assisted housing "increased substantially between 1996 and 1998." For the largest public housing authorities, a family's average time on a waiting list rose from 22 to 33 months from 1996 to 1998 - a 50 percent increase. The waiting period is even longer in some large cities - eight years in New York City; six years in Oakland, CA; and five years in Washington, DC, and Cleveland. The average waiting period for a Section 8 rental assistance voucher rose from 26 months to 28 months between 1996 and 1998. The waiting period for the vouchers, which are used to help families in need rent privately owned apartments, is now ten years in Los Angeles and Newark; eight years in New York City, seven years in Houston; and five years in Memphis and Chicago.

  • The number of families on waiting lists for HUD assistance has increased as well. Where waiting lists have not been closed due to overwhelming size, the typical increase was 10 to 25 percent from 1998 to 1999. The 40 waiting lists examined in detail for the study issued today include almost 1 million families -- an average of almost 25,000 on each list.

  • "Between 1995 and 1997, rents increased faster than income for the 20 percent of American households with the lowest incomes, according to the Bureau of Labor Statistics. The Consumer Price Index for Residential Rent rose 6.2 percent between 1996 and 1998 - significantly higher than the 3.9 percent rate of inflation for the period."

  • The number of housing units that rent for less than $300, adjusted for inflation, declined from 6.8 million in 1996 to 5.5 million in 1998, a 19 percent drop of 1.3 million units. In 1998, the median asking rent of new rental unit remained out of reach for most low-income families, at $726.

  • The number of households receiving rental assistance from HUD dropped by 51,000 from 1996 to 1998, when the Congress barred HUD from issuing new rental assistance vouchers. Congress provided HUD with 90,000 new vouchers in the current year. HUD now provides housing assistance through Section 8 rental assistance to 3 million households and subsidizes public housing units for another 1.3 million households - for a total of 4.3 million.

  • Private landlords are "opting-out" of HUD-assisted subsidy contracts, threatening to worsen the housing crisis. In 1998 alone, almost 13,000 housing units were lost through opt-outs, as owners quit the project-based Section 8 program in search of higher market-rate rents.

Cuomo said the new report shows the need for the $28 billion HUD budget that President Clinton has proposed for Fiscal Year 2000. The proposed budget - $2.5 billion above the current HUD budget - calls for actions to increase the supply of affordable housing. These include the creation of 100,000 new rental assistance vouchers, and steps under the HOME Program to stimulate the creation of about 84,400 affordable housing units.

The report indicates that the number of families with crisis-level housing needs - called "worst case needs" - remains at or near 5.3 million, the same level found in 1995. The families earn less than 50 percent of the area median income and either pay over half their incomes for rent, live in severely substandard housing, or both.

The report says: "At a time of unprecedented prosperity for so many, islands of despair remain. The very strength of our economy is forcing the poorest renters to compete for a shrinking pool of affordable units. With nowhere else to turn, millions of families with worst case housing needs join lists for HUD-assisted housing and are left waiting in vain."

Content Archived: January 20, 2009

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