Housing in the United States

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Various types of housing in the United States Us housing.png
Various types of housing in the United States

Housing in the United States comes in a variety of forms and tenures. The rate of homeownership in the United States, as measured by the fraction of units that are owner-occupied, was 64% as of 2017. [1] This rate is less than the rates in other large countries such as China (90%), Russia (89%) Mexico (80%), or Brazil (73%) (see List of countries by home ownership rate).

Contents

Housing in the United States is heavily commodified, and when viewed as an economic sector, contributes to 15% of the gross domestic product. [2] As in countries such as Canada or the United Kingdom, the United States is experiencing a crisis in housing affordability, with cost increases in housing vastly outstripping wage growth. From 2000 to 2021, the median rent more than doubled. [3] The amount of public housing is capped via the Faircloth Limit, and when available can only be offered to households meeting certain eligibility requirements.

More than half a million people are homeless. The geographic patterns of homelessness in the United States are explained by the high cost and low availability of housing, rather than variations in the rates of mental illness or drug addiction. [4]

Most houses in the United States are made from wood.

Overview

Housing as shelter is one of the "basic needs" of humans, offering protection against the elements. [5] It also provides a place of privacy away from the public eye where daily activities can take place. Residents often have personal attachment to a house, making it a home. A home's location, style and access to schools, parks, and other amenities can align a household to a greater community to reinforce cultural or religious bonds. These characteristics can also reinforce residential segregation and unequal access to amenities. [6]

Housing is also important to developers, builders, lenders, realtors, investors, architects, and other specialized professions and trades. These groups view housing as a commodity for financial gain. [6]

As the United States industrialized in the 20th century, demand for housing fueled job growth and consumer products to create economic growth. By the 1970s, the United States was being deindustrialized, and regional economies began to diverge: previously manufacturing-focused cities in the Rust Belt and elsewhere experienced population decline, and housing costs rose drastically in urban regions such as New York, San Francisco and Boston. [7] In 2016, housing costs in two thirds of the United States exceeded wage growth. [8] Housing prices have risen dramatically since the Covid pandemic and are unlikely to change anytime soon. In January 2020, the median home price was $290,499 – nearly 45% lower than the median home price in May 2023. [9]

For households earning 30% of the county's median income, most counties in the United States do not have rental housing considered affordable to at least half that income segment (one-third of 30% of median). [10]

Construction

A wooden home is reconstructed following a wildfire in California. Northern California Wildfire Recovery (25991472867).jpg
A wooden home is reconstructed following a wildfire in California.

Wood framing is widely used in home construction in the United States, accounting for 90% of new houses in 2019. [11] Concrete is used to build a foundation, usually with either a crawl space, or basement included. Interiors usually have drywall. Roofing often consists of asphalt shingles, although steel, and tile materials are also used. [12]

Wood-frame construction in the United States is more cost effective than masonry, in part because bricks typically must be shipped farther and labor costs are higher; [13] however, it is perceived to be flimsy in comparison to typical European construction. [14] [15] The federal government and insurance agencies have tried to promote concrete-frame construction and other basic techniques for resisting extreme weather events, but with little success: a 2017 report by McKinsey concluded that "the productivity of construction remains stuck at the same level as 80 years ago". [16]

Increasingly, some property insurers will no longer offer home insurance policies in regions where houses are often destroyed by weather events such as wildfires or hurricanes. [17]

Supply

The 2021 Surfside condominium collapse briefly focused the country's attention on the structural integrity of its housing. Surfside condominium collapse photo from Miami-Dade Fire Rescue 2.jpg
The 2021 Surfside condominium collapse briefly focused the country's attention on the structural integrity of its housing.

There are about 135 million homes in the United States as of 2016. [18] Housing researchers generally conclude that the supply of housing in the United States is too low to meet demand, [19] resulting in an affordability crisis. [20] [21] Among the renting population, nearly half pay more than 30% of their income toward rent. [20]

Although a nationwide problem, the undersupply of housing is caused in large part by local community actions that discourage new development. [20] [22] These include the imposition of regulations such as single-family zoning, minimum parking requirements, and height restriction laws that limit the density of new residences within a municipality or increase the expense and difficulty of construction. These tactics are related to the social phenomenon of nimbyism, in which existing residents, especially those who own property, work to stymie new construction. [20] [22] In particular, the suppression of moderate-density housing such as duplexes and townhouses has resulted in a so-called missing middle problem that drives up housing scarcity and inhibits the development of walkable neighborhoods.

The typical age of a home varies by state, with a national median of 39 years. [21] A 2016 report by the Center for American Progress found that 30 million homes have health or safety hazards, such as problems with plumbing, natural gas, or heating; 6 million of these homes have structural problems. [18] Structural failures in condominium or apartment buildings have resulted in catastrophic loss of life, as in the 2021 Surfside condominium collapse. [23] Many of the 160,000 condominium buildings in the United States do not have sufficient funds to carry out major repairs. [23]

Poor-quality housing in the United States is associated with increases in chronic illnesses such as asthma and eczema, as well as the negative effects from the persistence of environmental lead (e.g., from lead paint that has not been removed). These effects are particularly acute in the dilapidated housing characteristic of dense urban environments. [24]

Public housing

For many, the demolition of Pruitt-Igoe in St. Louis was symbolic of the US attitude to public housing. The Pruitt-Igoe site remains largely vacant. Pruitt-Igoe-collapses.jpg
For many, the demolition of Pruitt–Igoe in St. Louis was symbolic of the US attitude to public housing. The Pruitt–Igoe site remains largely vacant.

Federal efforts at public housing began in the 1930s, with a series of New Deal efforts culminating in the Housing Act of 1937. This created the United States Housing Authority as a centralized agency with the power to disburse funds, while the work of building and maintaining public housing projects was largely devolved onto state and municipal public housing authorities. From the outset, public housing was tied to the notion of "slum clearance", and the 1937 Act required that for every unit of public housing that was built, another unit had to be eliminated. [25] Additionally, to protect the commodified housing market, the 1937 Act, and the 1949 Act that followed it, effectively restricted public housing to low-income households, [25] thereby concentrating poverty into these housing projects. The 1949 Act also required that targets of slum clearance (by then called "urban renewal") be given preference in public housing projects, further concentrating poverty.

The federal government began to enmesh public housing with private development through a series of acts in 1959, 1961, 1965, and 1968, and 1970. [26] [25] The Housing and Community Development Act of 1974 established the Section 8 program, which directs public housing money to private landlords via means-tested rental assistance. [25] Private subsidy was coupled with an underinvestment in public housing, and large projects such as Cabrini–Green in Chicago and Pruitt–Igoe in St. Louis became notorious for their squalor.

The amount of public housing crested in the 1990s, with about 1.4 million units. Today, the number of units has been reduced to 1.0 million. [27] The fraction of US households receiving public or subsidized housing is far lower than the fraction in Western Europe. [28]

Commodification

Economists have noted increasing ownership of housing units by investors keeping the units vacant or renting them to the exclusion of traditional homebuyers. Investors bought about one of every seven U.S. homes in the first quarter of 2021, up from the prior three quarters, in which they bought closer to 1 in 10 homes. [29]

Homelessness

A homeless encampment across the street from a Victorian-era house in San Francisco Homeless PERSON in front of parked Tesla.jpg
A homeless encampment across the street from a Victorian-era house in San Francisco

In 2014, approximately 1.5 million homeless people resided in shelters. [30] As of 2018, the Department of Housing and Urban Development reported there were roughly 553,000 homeless people in the United States on a given night, [31] or 0.17% of the population. Recent spikes in the homeless population include a 44% increase in Seattle in 2017 [32] and 16% in the city of Los Angeles in 2019. [33] [34] In January 2018 the federal government statistics gave comprehensive encompassing nationwide statistics, with a total number of 552,830 individuals, of which 358,363 (65%) were sheltered in provided housing, while some 194,467 (35%) were unsheltered. [35]

There is some geographic variation in the rate of homelessness, which is correlated with the cost and availability of housing. [4] [36] [37] Popular alternative explanations such as rates of mental illness or drug addiction do not explain the observed geographic variation in homelessness rates, nor do differences in regional climates. [4] [36]

See also

Related Research Articles

<span class="mw-page-title-main">Public housing</span> Residential properties owned by a government

Public housing is a form of housing tenure in which the property is usually owned by a government authority, either central or local. Although the common goal of public housing is to provide affordable housing, the details, terminology, definitions of poverty, and other criteria for allocation vary within different contexts.

<span class="mw-page-title-main">Homelessness in the United States</span>

In the United States, the number of homeless people on a given night in January 2023 was more than 650,000 according to the Department of Housing and Urban Development. Homelessness has increased in recent years, in large part due to an increasingly severe housing shortage and rising home prices in the United States.

<span class="mw-page-title-main">Affordability of housing in the United Kingdom</span> Housing affordability in the UK

The affordability of housing in the UK reflects the ability to rent or buy property. There are various ways to determine or estimate housing affordability. One commonly used metric is the median housing affordability ratio; this compares the median price paid for residential property to the median gross annual earnings for full-time workers. According to official government statistics, housing affordability worsened between 2020 and 2021, and since 1997 housing affordability has worsened overall, especially in London. The most affordable local authorities in 2021 were in the North West, Wales, Yorkshire and The Humber, West Midlands and North East.

A real-estate bubble or property bubble is a type of economic bubble that occurs periodically in local or global real estate markets, and it typically follows a land boom. A land boom is a rapid increase in the market price of real property such as housing until they reach unsustainable levels and then declines. This period, during the run-up to the crash, is also known as froth. The questions of whether real estate bubbles can be identified and prevented, and whether they have broader macroeconomic significance, are answered differently by schools of economic thought, as detailed below.

<span class="mw-page-title-main">Affordable housing</span> Housing affordable to those with a median household income

Affordable housing is housing which is deemed affordable to those with a household income at or below the median as rated by the national government or a local government by a recognized housing affordability index. Most of the literature on affordable housing refers to mortgages and a number of forms that exist along a continuum – from emergency homeless shelters, to transitional housing, to non-market rental, to formal and informal rental, indigenous housing, and ending with affordable home ownership.

<span class="mw-page-title-main">Housing</span> Living spaces

Housing, or more generally, living spaces, refers to the construction and assigned usage of houses or buildings individually or collectively, for the purpose of shelter. Housing is a basic human need, and it plays a critical role in shaping the quality of life for individuals, families, and communities.

<span class="mw-page-title-main">Subsidized housing in the United States</span> Rental assistance for low-income households

In the United States, subsidized housing is administered by federal, state and local agencies to provide subsidized rental assistance for low-income households. Public housing is priced much below the market rate, allowing people to live in more convenient locations rather than move away from the city in search of lower rents. In most federally-funded rental assistance programs, the tenants' monthly rent is set at 30% of their household income. Now increasingly provided in a variety of settings and formats, originally public housing in the U.S. consisted primarily of one or more concentrated blocks of low-rise and/or high-rise apartment buildings. These complexes are operated by state and local housing authorities which are authorized and funded by the United States Department of Housing and Urban Development (HUD). In 2020, there were one million public housing units. In 2022, about 5.2 million American households that received some form of federal rental assistance.

<span class="mw-page-title-main">Affordable housing in Canada</span>

Affordable housing in Canada is living spaces that are deemed financially accessible to those with a median household income in Canada. The property ladder continuum of affordable housing in Canada includes market, non-market, and government-subsidized housing.

<span class="mw-page-title-main">San Francisco housing shortage</span> Serious crisis in California

Starting in the 1990s, the city of San Francisco, and the surrounding San Francisco Bay Area have faced a serious housing shortage, such that by October 2015, San Francisco had the highest rents of any major US city. San Francisco's onerous permitting and approval processes have given city the slowest permitting process of any large city in the United States, with the first stage taking an average of 450 calendar days, and the second stage taking 630 days for typical multi-family housing, or 860 days for a single-family house, and the second-most expensive construction costs in the world.

<span class="mw-page-title-main">Homelessness in California</span>

The United States Department of Housing and Urban Development estimated that more than 181,399 people were experiencing homelessness in California in January 2023. This represents more than 27% of the homeless population of the United States even though California has slightly less than 12% of the country's total population, and is one of the highest per capita rates in the nation, with 0.46% of residents being homeless. More than two-thirds of homeless people in California are unsheltered, which is the highest percentage of any state in the United States. 49% of the unsheltered homeless people in the United States live in California: about 123,423 people, which is eight times as many as the state with the second highest total. Even those who are sheltered are so insecurely, with 90% of homeless adults in California reporting that they spent at least one night unsheltered in the past six months.

The term housing crisis refers to acute failures in the housing market at a given place and time. Depending on the context and the speaker, the term has taken on substantially different meanings. A prominent current use, for example, refers to shortages of available housing in the United States and other countries, but it has also been used to describe financial crises related to the real estate sector.

<span class="mw-page-title-main">California housing shortage</span> Extended and increasing shortage since 1970

Since about 1970, California has been experiencing an extended and increasing housing shortage, such that by 2018, California ranked 49th among the states of the U.S. in terms of housing units per resident. This shortage has been estimated to be 3-4 million housing units as of 2017. Experts say that California needs to double its current rate of housing production to keep up with expected population growth and prevent prices from further increasing, and needs to quadruple the current rate of housing production over the next seven years in order for prices and rents to decline.

<span class="mw-page-title-main">Housing insecurity in the United States</span>

Housing insecurity is the lack of security in an individual shelter that is the result of high housing costs relative to income, poor housing quality, unstable neighborhoods, overcrowding, and, but may not include, homelessness.

<span class="mw-page-title-main">Eviction in the United States</span> Landlord removals of rental housing tenants in the North American country

Eviction in the United States refers to the pattern of tenant removal by landlords in the United States. In an eviction process, landlords forcibly remove tenants from their place of residence and reclaim the property. Landlords may decide to evict tenants who have failed to pay rent, violated lease terms, or possess an expired lease. Landlords may also choose not to renew a tenant's lease, however, this does not constitute an eviction. In the United States, eviction procedures, landlord rights, and tenant protections vary by state and locality. Historically, the United States has seen changes in domestic eviction rates during periods of major socio-political and economic turmoil—including the Great Depression, the 2008 Recession, and the COVID-19 pandemic. High eviction rates are driven by affordable housing shortages and rising housing costs. Across the United States, low-income and disadvantaged neighborhoods have disproportionately higher eviction rates. Certain demographics—including low income renters, Black and Hispanic renters, women, and people with children—are also at a greater risk of eviction. Additionally, eviction filings remain on renters' public records. This can make it more difficult for renters to access future housing, since most landlords will not rent to a tenant with a history of eviction. Eviction and housing instability are also linked to many negative health and life outcomes, including homelessness, poverty, and poor mental and physical health.

<span class="mw-page-title-main">Affordable housing by country</span>

Affordable housing is housing that is deemed affordable to those with a median household income as rated by the national government or a local government by a recognized housing affordability index. A general rule is no more than 30% of gross monthly income should be spent on housing, to be considered affordable as the challenges of promoting affordable housing varies by location.

<span class="mw-page-title-main">New York City housing shortage</span>

For many decades, the New York metropolitan area has suffered from an increasing shortage of housing, as housing supply has not met housing demand. As a result, New York City has the highest rents of any city in the United States.

<span class="mw-page-title-main">Affordable housing in Silicon Valley</span>

Silicon Valley, a region located in the southern part of the San Francisco Bay Area, is one of the most expensive regions to live in the United States, and many residents lack access to affordable housing. In 2018, the median home price across the area was $1.18 million, the highest of the 100 largest metro areas in the U.S. The growth of the technology industry in the area, including major companies like Google, Facebook, and Apple, is frequently cited as a major cause of the issue. There have been local efforts to address affordable housing, as well as state measures in response to housing issues across California.

<span class="mw-page-title-main">Dean Preston</span> American politician

Dean E. Preston is an American attorney and member of the San Francisco Board of Supervisors. In November 2019, Preston won a special election to finish Mayor London Breed's term on the Board of Supervisors. He was re-elected in the November 2020 election.

<span class="mw-page-title-main">Cancel rent</span>

Cancel rent is a slogan and tenant rights movement in the United States, which advocates for the cancellation of rental payments and suspension of mortgage payments during the coronavirus pandemic. Activists and organizations have also presented other demands, which include the cancellation of housing-related expenses, cancellation of late fees for housing payments, the establishment of a landlord hardship fund, an increase in emergency housing, and an eviction moratorium. The movement was triggered by the economic impact of the pandemic, in which mass business closures and employee layoffs resulted in financial insecurity for many Americans. Tenants faced a range of issues, including the inability to pay rent, harassment or intimidation from landlords, and potential eviction. This situation put tenants at risk of damaged credit ratings, food insecurity, and homelessness. Consequently, activists, tenants rights organizations, and some politicians have called for the cancellation of rent.

The term "affordable housing" refers to housing that is considered economically accessible for individuals and families whose household income falls at or below the Area Median Income (AMI), as evaluated by either national or local government authorities through an officially recognized housing affordability index. However, in the US, the term is mostly used to refer to housing units that are deed restricted to households considered Low-Income, Very Low-Income, and Extremely Low-Income. These units are most often constructed by non-profit "affordable housing developers" who use a combination of private money and government subsidies. For-profit developers, when building market-rate developments, may include some "affordable" units, if required as part of a city's inclusionary zoning mandate.

References

  1. ↑ "Homeownership: The American Dream | HUD USER". www.huduser.gov. Retrieved 2022-03-02.
  2. ↑ "Housing and GDP" (PDF).
  3. ↑ Desmond, Matthew (March 9, 2023). "Why Poverty Persists in America". The New York Times. New York Times.
  4. 1 2 3 Colburn, Gregg (2022). Homelessness is a housing problem: how structural factors explain U.S. patterns. Clayton Page Aldern. Oakland, California. ISBN   978-0-520-38376-0. OCLC   1267404765. Archived from the original on February 22, 2023. Retrieved November 10, 2022.{{cite book}}: CS1 maint: location missing publisher (link)
  5. ↑ Denton, John A. (1990). Society and the official world: a reintroduction to sociology. Dix Hills, N.Y: General Hall. p. 17. ISBN   978-0-930390-94-5.
  6. 1 2 Carswell, Andrew T. (2012-05-31). The Encyclopedia of Housing, Second Edition. SAGE Publications. ISBN   978-1-4129-8958-9.
  7. ↑ "Housing Is Key to Improving the American Economy". Bloomberg.com. 2019-02-05. Retrieved 2021-01-21.
  8. ↑ "Home prices rising faster than wages: Report". CNBC. 2016-03-24. Retrieved 2021-03-16.
  9. ↑ Aratani, Lauren (2023). "Buying a home in the US is expensive – and that isn't changing anytime soon". The Guardian.
  10. ↑ In A High-Rent World, Affordable And Safe Housing Is Hard To Come By (with map)
  11. ↑ Semuels, Alana (2021-06-02). "Wildfires Are Getting Worse, So Why Is the U.S. Still Building Homes With Wood?". Time .
  12. ↑ Anderson, L. O. (1975). Wood-Frame House Construction. US Department of Agriculture.
  13. ↑ Blumgart, Jake; Yin, Steph (2019-08-09). "'We don't build them like we used to' — Why new houses aren't made of brick". WHYY .
  14. ↑ Lewis, Roger K. (2012-11-16). "Heeding the cruel housing lessons of Hurricane Sandy". Washington Post .
  15. ↑ Roberts, David (2020-01-15). "The hottest new thing in sustainable building is, uh, wood". Vox .
  16. ↑ Flavelle, Christopher (2018-06-20). "Hurricane-Proof Homes Are Real. Why Isn't Anyone Buying Them?". Bloomberg.
  17. ↑ Wile; Cui (2023). "Homeowners in California and Florida are running out of options to protect their homes". NBC News.
  18. 1 2 Campbell, Alexia (2016-07-25). "Gas Leaks, Mold, and Rats: Millions of Americans Live in Hazardous Homes". The Atlantic.
  19. ↑ Badger, Emily (2022-01-20). "Something Has to Give in the Housing Market. Or Does It?". New York Times .
  20. 1 2 3 4 Sisson, Patrick; Andrews, Jeff; Bazeley, Alex (2019-05-15). "The affordable housing crisis, explained". Curbed .
  21. 1 2 Gray, Nolan (2022-01-22). "Stop Fetishizing Old Homes". The Atlantic .
  22. 1 2 Demsas, Jerusalem. "How Blue Cities Became So Outrageously Unaffordable" (Interview). Interviewed by Ezra Klein. New York Times . Retrieved 2022-02-05.
  23. 1 2 Orton, Kathy; Armus, Teo; Craig, Tim (2021-07-21). "After the Florida building collapse, condos struggle to fund big repairs". Washington Post.
  24. ↑ Bashir, Samiya A. (2002). "Home Is Where the Harm Is: Inadequate Housing as a Public Health Crisis". American Journal of Public Health. 92 (5): 733–738. doi:10.2105/AJPH.92.5.733. PMC   3222229 . PMID   11988437.
  25. 1 2 3 4 McCarty, Maggie (2014). Introduction to Public Housing (Report). Congressional Research Service. CRS R41654.
  26. ↑ Overview of Federal Housing Assistance Programs and Policy (Report). Congressional Research Service. 2019. CRS RL34591.
  27. ↑ Andrews, Jeff (2020-01-13). "Affordable housing is in crisis. Is public housing the solution?". Curbed .
  28. ↑ Dreier, Peter (2018-04-16). "Why America Needs More Social Housing". American Prospect.
  29. ↑ Glaze, Tim (2021-05-19). "Investors are buying up single-family homes across the US". HousingWire. Retrieved 2023-02-12.
  30. ↑ "Here are 10 New Facts About Sheltered Homelessness in America". National Alliance to End Homelessness. November 10, 2015. Retrieved March 21, 2020.
  31. ↑ The 2018 Annual Homeless Assessment Report (AHAR) to Congress. December 2018. Authors: Meghan Henry, Anna Mahathey, Tyler Morrill, Anna Robinson, Azim Shivji, and Rian Watt, Abt Associates. Department of Housing and Urban Development (HUD).
  32. ↑ "Seattle's homeless population went up 44% in the last two years". Q13 FOX News. December 6, 2017.
  33. ↑ EVEN AS HOUSING PLACEMENTS REACH NEW HEIGHTS, 2019 GREATER LOS ANGELES HOMELESS COUNT SHOWS 12% RISE IN HOMELESSNESS
  34. ↑ Cowan, Jill (June 5, 2019). "Homeless Populations Are Surging in Los Angeles. Here's Why". The New York Times. The New York Times. Retrieved March 21, 2020.
  35. ↑ www.whitehouse.gov
  36. 1 2 Demsas, Jerusalem (December 12, 2022). "The Obvious Answer to Homelessness". The Atlantic. Archived from the original on December 12, 2022. Retrieved December 12, 2022.
  37. ↑ Ludden, Jennifer (January 25, 2024). "Housing is now unaffordable for a record half of all U.S. renters, study finds". NPR . Retrieved January 26, 2024. As the Harvard report notes, U.S. homelessness rates hit a record high last year. The Biden administration and housing experts link that squarely to a severe housing shortage that has helped drive up prices. "We simply don't have enough homes that people can afford," says Jeff Olivet, executive director of the U.S. Interagency Council on Homelessness. "And when you combine rapidly rising rent — that it just costs more per month for people to get into a place and keep a place — you get this vicious game of musical chairs."

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