Another Housing Crisis Is Coming – And Bailouts And Eviction Freezes Won't Be Enough To Prevent Many From Losing Their Homes

Millions of Americans are suddenly out of work as the financial and economic crisis sparked by the coronavirus pandemic deepens. Without an income, most of these people will have a hard time covering their expenses, including keeping a roof over their heads.

But even before the current crisis, tens of millions of Americans struggled to pay for housing, spending more than 30% – or even half – of their income on housing-related expenses. This leaves less money for other essentials such as food, health care and savings.

Governments have offered a variety of plans to support those hurt by the coronavirus pandemic, from direct payments and higher unemployment checks to eviction freezes and mortgage relief.

We are researchers who study the intersection of housing and health. While these measures may tide over many Americans, we don’t believe they will be enough to help the most vulnerable endure the crisis or prevent many people from losing their homes.

Unaffordable housing

Lower-income households were already on the verge of a housing crisis before the pandemic thanks to a chronic shortage of affordable housing in the U.S.

Housing affordability is largely measured as the ratio between housing-related expenditures and household income. Households that spend 30% or more of their income on rent or mortgage, property taxes, utilities and other expenses associated with their homes are considered “cost burdened” because it means they have insufficient financial resources for other basic needs including food and medicine.

The Department of Housing and Urban Development estimates 38 million, or over a quarter, of U.S. households were cost burdened in 2018. Of these, an estimated 12 million were spending over half of their annual income on housing costs, making them severely burdened.

Households earning US$35,000 or less made up 63% of these cost-burdened households. In 2019, a family living on one full-time minimum wage income was not able to afford local fair-market rent for a two-bedroom apartment anywhere in the U.S.

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This article is republished from The Conversation under a Creative Commons license.

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