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the Campaign for Affordable Housing

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THE TRUTH ABOUT AFFORDABLE

HOUSING

presented by



Taking Action to Solve America’s Housing Crisis


USDA Photo


In recent decades, home prices and rental rates have increased faster than income in most parts

of the country, increasing the need for affordable housing.


Wages and the Cost of Housing in Los Angeles, California(Los Angeles, CA Metropolitan Area)

Rental Market2005

Fair Market Rent2

1BR $900/Month2BR $1,124/Month

Homeownership Market2005

Median Priced Home1

(Single- and Multi-Family)

$430,000

$136,366

$49,515

$41,083

$51,166

Annual IncomeNeeded3

Police Officer5

Firefighter5

Elementary SchoolTeacher5

Typical Annual Salaries (2005)

$17.31

$21.62

$12.80

$12.35

Hourly WageNeeded to Afford4

Retail Salesperson5

Janitor5

Construction Laborer5

Typical Hourly Wage (2005)

$18.18

1 Bedroom

2 Bedrooms

1Data on the median-priced home are from the National Association of Home Builders' Housing Opportunity Index for the first quarter (1Q) of 2005.2Rental data are from the U.S. Department of Housing and Urban Development's report on Fair Market Rents for the year 2005 and are based on a survey of recently occupied units. 3The annual income needed to qualify for a mortgage was calculated using the average prevailing interest rate, assumes a 10 percent downpayment and the use of private mortgage insurance, and includes principal, interest, taxes and insurance. 4The Hourly Wage Needed to Afford is the hourly wage that must be earned so that this rent does not exceed 30 percent of income, a standard measure of affordability. It is based on a concept developed by the National Low Income Housing Coalition. 5Wage data are as of February, 2005 and were obtained from a proprietary database of salary information by geographic location maintained by Salary.com.

Source: Paycheck to Paycheck 2005, and interactive database maintained by The Center for Housing Policy, the research affiliate of the National Housing Conference.




Wages and the Cost of Housing in Seattle, Washington(Seattle, WA Metropolitan Area)

Rental Market2005

Fair Market Rent2

1BR $693/Month2BR $834/Month


Median Priced Home1


$275,000


Police Officer5

Firefighter5



$87,210

$46,664

$38,718

$48,220

$13.33

$16.04

$12.07

$11.64


Retail Salesperson5

Janitor5



$17.13

1 Bedroom

2 Bedrooms




Wages and the Cost of Housing in Atlanta, Georgia(Atlanta, GA Metropolitan Area)


Median Priced Home1


$165,000

$52,326

$44,077

$36,571

$45,547


Police Officer5

Firefighter5



Rental Market2005

Fair Market Rent2


$14.42

$16.04

$11.40

$10.99


Retail Salesperson5

Janitor5



$16.18

1 Bedroom

2 Bedrooms




Wages and the Cost of Housing in Chicago, Illinois(Chicago, IL Metropolitan Area)


Median Priced Home1


$230,000

$72,940

$47,805

$39,664

$49,399


Police Officer5

Firefighter5



Rental Market2005

Fair Market Rent2


$15.44

$17.42

$17.55

$11.92


Retail Salesperson5

Janitor5



$12.36

1 Bedroom

2 Bedrooms




Wages and the Cost of Housing in Wichita, Kansas(Wichita, KS Metropolitan Area)


Median Priced Home1


$105,000

$33,299

$43,068

$35,734

$44,504


Police Officer5

Firefighter5



Rental Market2005

Fair Market Rent2


$9.25

$12.00

$11.14

$10.74


Retail Salesperson5

Janitor5



$15.81

1 Bedroom

2 Bedrooms




Wages and the Cost of Housing in Tuscon, AZ(Tuscon, AZ Metropolitan Area)


Median Priced Home1


$177,000

$56,132

$41,533

$34,460

$42,918


Police Officer5

Firefighter5



Rental Market2005

Fair Market Rent2


$10.08

$12.94

$10.74

$10.36


Retail Salesperson5

Janitor5



$15.25

1 Bedroom

2 Bedrooms




Actual Income vs. Income Needed to Purchase Median Priced Home

MedianHome Price1

IncomeNeeded2 Police Officer3 Firefighter3

Elementary School Teacher3

Location 2005 2005 2005 Diff 2005 Diff 2005 Diff

Los Angeles, CA $430,000 $136,366 $49,515 ($86,851) $41,083 ($95,283) $51,166 ($85,200)

Seattle, WA $275,000 $87,210 $46,664 ($40,546) $38,718 ($48,492) $48,220 ($38,990)

Atlanta, GA $165,000 $52,326 $44,077 ($8,249) $36,571 ($15,755) $45,547 ($6,779)

Chicago, IL $230,000 $72,940 $47,805 ($25,135) $39,664 ($33,276) $49,399 ($23,541)

Wichita, KS $105,000 $33,299 $43,068 $9,769 $35,734 $2,435 $44,504 $11,205

Tuscon, AZ $177,000 $56,132 $42,918 ($13,214) $34,460 ($21,672) $42,918 ($13,214)




Actual Income vs. Income Needed to Rent at Fair Market Value

1Bedroom Fair Market

Value2 Bedroom Fair Market Value

1 Bedroom Hourly Rate

Needed

2 Bedroom Hourly Rate

Needed

Location

Los Angeles, CA $900.00 $1,124.00 $17.31 $21.62

Seattle, WA $693.00 $834.00 $13.33 $16.04

Atlanta, GA $750.00 $834.00 $14.42 $16.04

Chicago, IL $803.00 $906.00 $15.44 $17.42

Wichita, KS $481.00 $624.00 $9.25 $12.00

Tuscon, AZ $524.00 $673.00 $10.08 $12.94

Retail Salesperson3 Janitor3 Construction Worker3

Location 1BR Diff

2BR Diff 2005

1BR Diff

2BR Diff 2005

1BR Diff

2BR Diff

Los Angeles, CA $12.80 ($4.51) (8.82) $12.35 ($4.96) ($9.27) $18.18 $0.87 ($3.44)

Seattle, WA $12.07 ($1.26) (3.97) $11.64 ($1.69) ($4.40) $17.13 $3.80 $1.09

Atlanta, GA $11.40 ($3.02) (4.64) $10.99 ($3.43) ($5.05) $16.18 $1.76 $0.14

Chicago, IL $12.36 ($3.08) (5.06) $11.92 ($3.52) ($5.50) $17.55 $2.11 $0.13

Wichita, KS $11.14 $1.89 (0.86) $10.74 $1.49 ($1.26) $15.81 $6.56 $3.81

Tuscon, AZ $10.74 $0.66 (2.20) $10.36 $0.28 ($2.58) $15.25 $5.17 $2.31


In spite of overall increases in homeownership rates, working

families with children are finding it harder and harder to

purchase a home.


The homeownership rate of working families with children in 2001 was almost 6 percentage points lower than it was prior to

1980.


Homeownership Rates All Householdsand Working Families 1978–2001

Source: Working Families with Children: A Closer Look at Homeownership Trends, published May 2004 by The Center for Housing Policy, the research affiliate of the National Housing Conference.

All Households All Families with Children All Working Families with Children(earning less than 120% A.M.I. but more than minimum wage)

0

80

65.2 63.966.9 68.0

70.5

63.4

67.5 68.4

62.5

55.8 56.3 56.6

1978

1991

1999

2001


Opposition to affordable housing makes it difficult and costly to

construct or renovate houses and apartments and undermines efforts to win political support for funding,

zoning and project approvals.


“…NIMBYism takes many forms. It can be as overt as a public demonstration against a new housing development. It also can be as insidious as the rigid application of zoning regulations that perpetuate social and economic segregation. Whatever its form, NIMBYism reflects the perception among existing residents that additional housing for low-to moderate-income people in their neighborhoods will hurt their property values or quality of life by increasing such problems as traffic congestion, crime and crowding of local public facilities.”1

1Paycheck to Paycheck: Wages and the Cost of Housing in Counties, published May 2004 by The Center for Housing Policy, the research affiliate of the National Housing Conference.


Working together, we can overcome NIMBYism with the truth.


Not in my backyard!

Not in my backyard!

TRUTH

Not in my backyard!

TRUTH

Not in my backyard!

TRUTH

Not in my backyard! TRUTH

TRUTH


Low Income(Below 80 percent of area median income for a family of four)

People Who Need Affordable Housing Are Our Neighbors

Most people who reside in affordable housing work. Here are examples of occupations and the typical annual salary levels in urban areas.

Truck Driver $30,100

THE TRUTH:

to see next salary


Legal Clerk $34,260




THE TRUTH:

to see next salary


Deputy Sheriff $40,398




THE TRUTH:

to see next salary


Firefighter $43,506




THE TRUTH:

to see next salary


Nurses Aide $11,500

Very Low Income(Below 50 percent of area median income for a family of four)



THE TRUTH:

to see next salary


Accounting Clerk $17,000




THE TRUTH:

to see next salary


Legal Secretary $23,920




THE TRUTH:

to proceed


THE TRUTH:

SOURCES: San Franciscan Bay Guardian (10/7/98); Nonprofit Housing Association of Northern California ; Good Neighbors Affordable Family Counseling; Jones, Pettus & Pyatok (1997); Annual Planning Information, Contra Costa County (1993); Marin Independent Journal (2/23/97); City of San Jose Memorandum (1/3/95).

Here are the occupations and employers of a real affordable apartment complex in San Jose, California.

Company Name Occupation

Aurelia’s Hair Time BeauticianBudget Rent-A-Car Administrative AssistantCapezio Factory Outlet SalesCapital Honda ReceptionistCity of San Jose Typist Clerk IICounty of Santa Clara Child CounselorCRX Telecom Corporation Receptionist/ClerkDanforth Biomed, Inc. TechnicianEmporium Store DetectiveFood-4-Less CashierIBM Corporation Associate Engineer

Company Name Occupation

Kaiser Hospital Staff AssistantMicro Chassis WelderSafeway CheckerSan Jose State University Instruction AssistantSan Jose Unified School District Bus DriverSouth Bay Pontiac/Cadillac Installer/TechnicianSorrento Cheese Company Machine OperatorSpar Logic AccountantStudio 5 Clothing ManagerTropicana Foods CashierWester Specialty Products Stone Cutter


Preserving existing affordable housing through rehabilitation

repairs and improves communities...

THE TRUTH:

the Campaign for Affordable HousingBefore…

the Campaign for Affordable Housing…and After...


Well-designed housing comes in many densities.

THE TRUTH:


Higher density affordable housing decreases traffic congestion.

THE TRUTH:

“Studies indicate that the average resident in a compact neighborhood will drive 20-30% less than residents of a neighborhood half as dense.” “At densities of 8 units per acre and higher, neighborhoods begin to support bus and rail transit….”

SOURCE: John Holtzclaw, www.sierraclub.org Local Government Commission


Higher density affordable housing lowers infrastructure costs.

THE TRUTH:

The U.S. Office of Technology Assessment found that it cost $10,000 [per unit] more to provide infrastructure to a lower density suburban development than to a more compact urban neighborhood. (OTA-EII-643, 1995)

Infrastructure costs per housing unit significantly decline as density increases: in developments at 30 units per acre or greater to about $10,000 from $90,000 per unit when built at 4 units per acre. (Urban Land Institute, Wieman, 1996)


Affordable housing comes in a size and design to fit every community.

THE TRUTH:


There are many good ways to educate our communities about

the need for affordable housing...


Working together to spread the truth helps those whose help we depend on to provide safe and

stable homes to their own families.


The Campaign for Affordable Housing provides public education,

advocacy training and advice for local groups who wish to expand

housing opportunities for all.


To learn more about our programs, publications and workshops, contact us at:

The Campaign for Affordable Housing5900 Wilshire Boulevard, 26th Floor

Los Angeles, CA 90036(323) 330-0540 phone

(323) 330-0541 [email protected]

the campaign for affordable housing this presentation is designed to run automatically. however, it...

Documents

department of housing

cost of housing

housing policy

affordable housing wages

national housing conference

wage data

americas housing crisis

annual income