A new report shows that while the rental housing market may be booming, extremely low-income renters in Illinois are very unlikely to find an apartment they can afford.
The report, Housing Spotlight: America’s Affordable Housing Shortage, and How to End It, jointly released by Housing Action Illinois and the National Low Income Housing Coalition, a D.C.- based research and policy organization, shows that there are only 28 rental homes affordable and available for every 100 extremely low-income renters in Illinois. Extremely low-income households have incomes at or below 30% of the area median income.
In the report, NLIHC analyzes data from the 2011 American Community Survey to compare the number of renters in a variety of income categories with the number of rental units priced at rents that are affordable to them. The report also explores the number of rental homes available to each category; that is, the number of units not occupied by renters with higher incomes. Nationally, there are only 30 rental units affordable and available for every 100 extremely low-income renters.
In Illinois, a family of four is considered by the federal government to be extremely low-income if their annual household income is at or below $20,850. For a single person, the amount is $14,600.
One out of every four, or 10.1 million, American renter households has an extremely low-income, but there are only 3 million rental units affordable and available them. This means 7.1 million of the poorest renter households cannot find housing they can afford. While the magnitude of the shortage varies by state, there is no state in which there are enough rental units affordable and available to this vulnerable population.
With very few affordable units available to them, 3 out of 4 extremely low-income renter households end up spending more than half of their limited income on rent and utility costs. It is the most vulnerable populations who are disproportionately represented among extremely low-income renters. Households who are elderly, have a family member with a disability, include minorities or are female-headed have a greater likelihood of having extremely low incomes than others. Low-income veterans also face severe housing cost burdens.
“The result of the foreclosure crisis is that many more people are renting and competition for those few rental units affordable to extremely low-income households has increased and rents for these households have continued to go up,” said Bob Palmer, Policy Director for Housing Action Illinois.
By comparison, the data shows that there are 99 rental homes both affordable and available for every 100 renter households considered low-income, that is, earning 80% or less of the area median income. In Illinois, a family of four is considered by the federal government to be low-income if their annual household income is at or below $55,600.
At the federal level, the National Low Income Housing Coalition says more affordable rental units could be made available if the government shifted the balance in its housing policy. The coalition, joined by Housing Action Illinois, calls for funding of the National Housing Trust Fund, which would build and rehabilitate rental housing for low income people, by modifying the mortgage interest deduction into a credit that would be available to more homeowners and create savings for the federal government. These savings could be redirected to fund housing that would meet the housing needs of America’s poorest families.
“We can end homelessness in this country and do it without increasing federal spending,” said Sheila Crowley, President and CEO of the National Low Income Housing Coalition. “All it takes is using federal housing subsidies in a way that is fairer and more efficient.”
Housing Action Illinois is a statewide coalition formed to protect and expand the availability of quality, affordable housing throughout Illinois. Housing Action’s more than 150 organizational members include housing counseling agencies, homeless service providers, and nonprofit developers of affordable housing.
The National Low Income Housing Coalition is dedicated solely to achieving socially just public policy that assures people with the lowest incomes in the United States have affordable and decent homes.