NLIHC Research Team: What We Do

NLIHC’s research team uses the most recent housing data to create resources for our members and other advocates. For 40 years, NLIHC has made high quality research a priority because our founder, Cushing Dolbeare, understood the importance of having hard numbers to back up the assertion that a community, city, or state has a real need for more affordable housing. A typical day for the research team generally falls into three categories:

Rapid response to requests for information. We answer requests for data from our members, state coalition partners, the media, members of Congress, and other researchers in a timely manner. When the Washington Post wanted to create an interactive map showing the one-bedroom Housing Wage in each county, we made sure they had all the information they needed by their deadline. Since our members often lack the resources to conduct the same level of in-depth analysis that we can, they can request custom data analysis – a benefit of being an NLIHC member, so don’t be afraid to call us!

NLIHC’s standard research products. For 25 years, NLIHC has produced our flagship report, Out of Reach, which features the Housing Wage – the hourly wage someone needs to earn in order to afford a modest apartment. We calculate the Housing Wage for every county, metropolitan area, combined nonmetropolitan area, and state in the country; this helps inform the public and policymakers on the extent of America’s affordable housing crisis. NLIHC also produces Congressional District Profiles and State Housing Profiles. These one-page profiles pack in key data such as the shortage of units affordable and available to renters at different income levels, and the number of renters at different income levels who spend more than 30% of their income on housing costs. We also produce Housing Spotlight, a series of occasional research briefs that use data from different sources to highlight a variety of housing issues.

One-time research projects. NLIHC is also always working on other research projects. In November of 2014, we released a report on the housing needs of veterans that was funded by the Home Depot Foundation. We continue to work with the Public and Affordable Housing Research Corporation (PAHRC) to maintain and update the National Housing Preservation Database, an inventory of all federally subsidized properties in the country. In the coming months we will release findings from our Alignment Project, a comprehensive analysis of the incomes of households currently served by federal housing programs, and the strategies used by developers to achieve deep affordability without the use of federal housing vouchers.

All of the data that the research team collects and analyzes make it clear that those suffering most from a lack of affordable housing in America are the lowest income residents. NLIHC’s research team is committed to providing advocates with the tools needed to take that message to their local, state, and federal policymakers.

Project Spotlight: State Housing Profiles

2014 State Housing Profile: CAHow many renters in my state are extremely low income (ELI)?

What is the total shortage of affordable and available units for ELI renters, and where in my state is that shortage the worst?

Which renter households face the greatest housing cost burden?

What is my state’s 2014 Housing Wage?

Advocates can find these answers and more powerful data on NLIHC’s State Housing Profiles. Updated in April to feature the most recent housing data, our State Housing Profiles use data from a variety of sources to provide an overview of affordable housing need at the state level. Advocates can use these one-page profiles to educate both the general public and lawmakers about the great need for affordable housing.

Click here to download your State Housing Profile today!

 

Twenty-five years after Out of Reach was first published, the housing crisis continues…

A week ago, NLIHC released its annual report, Out of Reach. Out of Reach 2014 provides extensive data on housing costs and wages for every state, county, and metropolitan area in the United States. Over the years, NLIHC has expanded and improved the Out of Reach report; however, the methodology remains the same. Here’s a review of some key definitions and figures used by Out of Reach:

AFFORDABILITY
What it means: The federally accepted standard of “affordable” housing is that which requires no more than 30% of the household income be spent on rent and utilities. Out of Reach uses this standard of affordability to determine the wages renters must earn to afford their local rent.

How to explain it:
Many Americans spend more than 30% of their income on housing costs. For some, this may be considered a short-term situation. However, for millions of low income Americans, spending more than 30% of their income on housing costs means serious housing instability as these households often live paycheck to paycheck.

When a household has to spend more than 30% of their income on rent and utilities, they are considered cost burdened. When a household has to spend more than 50% of their income on rent and utilities, they are considered severely cost burdened. Three out of every four extremely low income families are severely cost burdened, forcing them to make tough decisions on how to spend the little leftover income they have on food, transportation, medical costs, child care, and other important expenses.

FAIR MARKET RENT (FMR)
What it means: Simply put, Fair Market Rents (FMRs) are a standard measure of current housing costs across the country, using a consistent methodology. HUD estimates FMRs annually. They represent HUD’s best estimate of what a household seeking a modest rental unit in a short amount of time can expect to pay for rent and utilities in the current market. When calculating what incomes renters need to earn to afford rent, Out of Reach uses the Fair Market Rents.

HOUSING WAGE
What it means: How much must an individual earn hourly in order to afford a rental unit at FMR. The standard Housing Wage refers to a two-bedroom rental unit; however, Out of Reach also provides the Housing Wage for efficiencies up to 4-bedroom units in the state excel files. This figure is an average, available at the national level, state level, county level, and metropolitan area level.

How to use it: The 2014 two-bedroom national Housing Wage is $18.92. This figure varies considerably at state and local levels, so it is most effective to look up your county, metropolitan area, or state Housing Wage. You can compare this piece of data with what the average renter in that area actually earns, and what minimum wage workers earn.

While the Housing Wage can help your elected official understand the disparity between what renters in your community need to earn to afford rent and what they actually make, it is important to note that raising wages is an insufficient response to the problem. In every state, the Housing Wage is higher than the proposed raised federal minimum wage of $10.10. This disparity points to the extreme shortage of rental housing that is both affordable and available to low income renters. The strongest solution to the affordable housing crisis is an increased federal investment in affordable housing, which can be best achieved through the National Housing Trust Fund.

RENTER WAGE
What it means: How much does the average renter earn on an hourly basis. This wage is a mean calculation.

How to use it: Compare your state or local renter wage with your Housing Wage to demonstrate that the average renter cannot afford rent. It is important to note that because the renter wage is an average, many families face an even greater wage disparity.

HOURS AT MINIMUM WAGE NEEDED TO AFFORD RENT
ImageWhat it means: This one is pretty self-explanatory, which is why it has become one of the most popular data points from Out of Reach. This analysis is most widely recognized in its map form, which provides how many hours a minimum wage worker must work every week to afford a two-bedroom rental unit at Fair Market Rent. The calculations use the prevailing minimum wage (whichever is higher between the federal or state minimum wage).

How to use it: This Out of Reach analysis has been used by many to argue for increasing the federal minimum wage. In every state, this figure is greater than 40 hours per week, even when using the prevailing state minimum wage. This reveals that nowhere in America, can a full-time minimum wage worker afford a two-bedroom rental unit.

Learn more, and read the full Out of Reach 2014 report, at www.nlihc.org/oor/2014. Use the “View State Data” dropdown to access your state’s Out of Reach page. Click on the attached State Report (PDF) and State Data (Excel) to view and compare these and other data.

NEXT POST:
Barbara Stallone, Director of Policy and Public Relations for the Utah Housing Coalition, guest blog posts on how our state partner used Out of Reach data to advocate for an increased state minimum wage.

Reflections from the Road, by Sheila Crowley

The first road trip of the United for Homes campaign took place last week in the state of Michigan. Joseph Lindstrom and I visited eight communities in three days meeting with advocates and providers of low income housing, services to people who are homeless, and services for people with disabilities. We visited a CDC in Flint, a public housing agency in Reed City, a service center for people with disabilities in Kalamazoo, a statewide meeting of homeless service providers in Ann Arbor, and more.

We learned that the voucher administrator in Traverse City may have to give up the program because there are not enough funds to keep running it. We were told about families living in deer blinds in rural areas. We heard people with disabilities express their fear that they will lose their homes because of the federal government shutdown. We talked to homeless service providers who have laid off many members of staff because of the sequester. Everywhere we went, the common theme was the housing shortage for people who are poor and a feeling of desperation that it would only get worse.

kalamaoo-sheila-maps

Sheila speaking in Kalamazoo

NLIHC received high praise for our research and the voluminous data we make available to advocates to use to make the case for more rental housing that is affordable to the lowest income families in their communities. But I heard something more about what these data mean to people who are struggling to help poor and homeless people find affordable homes. The data help them to understand why their jobs are so hard and to “maintain sanity” in the face of overwhelming need. The data explain what is really going on.

We spend a lot of time in our local meetings going over the details of the United for Homes proposal to fund the National Housing Trust Fund with revenue raised by modifying the mortgage interest deduction. We got a lot of good, thoughtful questions that indicated that how engaged people were. We were able to show how few people in Michigan borrow over $500,000 to buy homes (0.5% of all mortgages between 2009 and 2011) and how much money would come to Michigan to solve the housing problems of the poor if our proposal became law. Having something to work towards, instead of just defending the status quo, offers advocates hope.

Many thanks to our hosts across the state for the warm welcome and encouragement. We are honored to partner with you to advance the United for Homes campaign for as long as takes.

On the Road & Busting Myths

The United for Homes campaign is pretty straightforward:

We want to reform the mortgage interest deduction, which would create almost $200 billion in revenue over ten years. And then, we want to use this new revenue to finally fund the National Housing Trust Fund!

What may seem more complicated is the actual proposal to reform the mortgage interest deduction, but that too, can easily be broken down. There are two main points to our proposal:

  1. Reduce the size of a mortgage eligible for the tax break to $500,000, and
  2. Convert the deduction to a 15% non-refundable tax credit.

Under current law, taxpayers can deduct the interest paid in that tax year on a home mortgage of up to $1 million. United for Homes proposes lowering the cap from $1 million to $500,000.

Now here comes a big myth: This will hurt many homeowners in my community.

The reality is just 4% of all mortgages in the U.S. are over $500,000, according to an analysis of Home Mortgage Disclosure Act data from 2007-2011.

As Sheila and Joe prepared to set out on the Michigan road trip, we took a deeper look at the mortgages in the state. Thanks to our savvy NLIHC Research team, we were able to prepare this map that reveals the percentages of mortgages over $500,000 in each county.

United for Homes

We have the opportunity to finally end homelessness! “Ah, but 0.1% of the mortgages in my county are over $500,000, so we cannot reform that tax break,” said no one ever.

The Michigan map has been very useful for Sheila and Joe as they present the United for Homes campaign, and we have state and county data available to help YOU educate others!

Yesterday in Flint, Amy Hoyer from Representative Dan Kildee’s office attended the community meeting. Amy spoke about the importance of advocates connecting with federal elected officials through calls and letters. She said it was critical that elected officials hear from their constituents on any proposal that may seem controversial.

United for Homes

Sue Hart puts a UFH bumper sticker on her car following the Flint community meeting. Endorse UFH in the next 2 minutes, and you will receive not 1, but 2 UFH bumper stickers! http://www.unitedforhomes.org/support

TAKE ACTION! We encourage you to contact your elected officials about the United for Homes proposal, and to use your state and county data to inform them on the actual percentage of mortgages over $500,000. After all, who doesn’t love bustin’ myths.

Click here to look up the percentages of mortgages in your state that are over $500,000.
For county data, email althea@nlihc.org.