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The United States is struggling with the massive affordable housing crisis. As there is not enough affordable housing available in the country, the families are paying more for their housing as well as renting. Due to the expensive price tag, homeownership is like an untouchable dream for many Americans. Those who work decent jobs are also finding financial difficulties while purchasing a new home.
The process of home building has been collapsed more than a decade ago. Not to mention, there are any intentions of recovering the problem. Construction of luxurious and expensive homes is recovered fast. However, there are also issues of oversupply in some areas across the United States.
However, the development of affordable housing in the United States that is priced for people who belong to the lower-income group and middle-income group to rising for the past couple of years. But, remember that the downfall is also massive and it would consume extra construction years to achieve a modest pace.
Affordable Housing Crisis is a Massive Concern
The undersupply share is primarily concentrated in some specific areas of the United States that develop significant economic growth opportunities. Maxwell Drever says this also drives the rent and housing price for low and middle-income families as per their choice of where they want to live.
The prices of properties that have been sold in the bottom fourth of the economical market are up by more than 8%. This is also doubled for affordable housing as the top fourth. Additionally, rents for families who are not capable of purchasing a house due to their weak financial structure have been increased more than 4% per annum over the last decade. This rise also grew rapidly during the pandemic.
Due to the rising rents, more and more renters are making less money to cover their basic living. Nowadays, more than 20% of renters use half of their monthly salary to pay the rent. This is why they face financial difficulties to cover the basic living expenses such as clothes, food, health care, education, etc. As per reports, an average renter saves less than $1,000 a year. This amount of money isn’t sufficient to cover financial or health emergencies.
The Rising Costs of House
The rising house costs are also making the economic opportunity for homeownership out of reach for more and more families, especially those of color. Today, the rate of homeownership for black is 42%, whereas the rate for Hispanics is 48%, says Maxwell Drever.
The shortfall of affordable housing in the United States is not only depressing the savings of millions of people but also increasing the wealth gap. The rate is also forcing the people from the bottom of the economic ladder to stay further away from the people who stay at the top. Many cities are only affordable for wealthy families, while many families are forced to live in modest areas.
Conclusion
The economy of the United States regarding the development of affordable housing has been skyrocketed recently. Not only the price of the houses, but also the rents creating massive profit margins to complement the investment. However, the fact is that the economies of developing affordable housing are still a precarious process as the mortgage rate is rising every day.
Ross is known as the Pambansang Blogger ng Pilipinas - An Information and Communication Technology (ICT) Professional by profession and a Social Media Evangelist by heart.
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