Yes there is, according to Harvard University’s Joint Center for Housing Studies (JCHS)’s recently released report entitled “America’s Rental Housing: Meeting Challenges, Building on Opportunities“—and it is growing. The report provides an up-to-date picture of the rental market, but also provides some historical context. For example:
- The rental housing market is tightening, and the nation’s current supply of affordable housing is insufficient: 18 million households are competing for 11.5 million units of affordable housing, and the supply/demand imbalance in the affordable inventory has worsened since the foreclosure crisis developed.
- Instead of growing, rental vacancy rates are falling across many markets and even modestly on a national basis. At one point, the multifamily industry was regularly producing 400,000 to 600,000 units annually, and some of that production added to the unsubsidized, but still affordable housing inventory. By contrast, production is now as low as 124,000 rental unit completions, with much of that production spurred by Low-Income Housing Tax Credit (LIHTC) investment.
- Rental supply growth is not necessarily happening where it is needed most. You can’t move vacant rental stock from southeast Florida to the oil boom towns of North Dakota.
- Existing supply is shrinking. The report says, “Since the mid-1990s, more than 700,000 rental units with federal subsidies tied to them were lost from the subsidized housing stock (either through demolition, or owner decision to abandon subsidies and turn the units into market-rate rentals). Meanwhile, nearly 12 percent of low-cost rentals existing in 1999 were demolished or otherwise permanently lost from the housing stock by 2009.”
While this supply/demand imbalance in the affordable rental housing market is not a new problem, the study illustrates that it has gotten considerably worse in recent years and shows no sign of getting any better in the near future, both in terms of the anemic supply as well as increased demand from struggling low-income families. Incomes among low-income households have been flat at best in recent years and in real terms are falling. At the same time, rental housing costs are increasing steadily, leaving renters with less disposable income to spend on food, education and health care.
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