If you’re viewing our site and researching potential real estate investments you probably aren’t too worried about how you’re going to pay the rent this month. Approximately 21 million American’s are not so fortunate. A recent study conducted by Harvard University’s Joint Center for Housing Studies found that the supply / demand gap for affordable housing hasn’t been this severe in decades and is getting worse. Furthermore, the percentage of renters that are “severely house burdened”, paying more than 30% of income on housing has doubled in 50 years.
Here are some highlights / excerpts from the Harvard Affordable Housing Study:
- The recent deterioration in rental affordability comes after a decade of lost ground. The share of cost-burdened renters increased by a stunning 12 percentage points between 2000 and 2010, the largest jump in any decade dating back at least to 1960.
- After remaining almost flat through the 1990s, rents climbed 6 percent in real terms between 2000 and 2012. Meanwhile, real median renter incomes fell over much of this period, ending 13 percent lower in 2012 than in 2000. As a result, the gap between rental costs and renter incomes in 2012 was wider than in any year except 2010.
- For every 100 extremely low-income renters, only 36 units were both affordable and available to meet this demand.
- The cumulative increase in the incidence of housing cost burdens is astounding. In 1960, about one in four renters paid more than 30 percent of income for housing. Today, one in two are cost burdened.
The need for our product, affordable housing, has never been greater. Park Street Partners, and its investors, hope to make a small dent in this problem by acquiring parks that have meaningful vacancy and infilling new homes for families that desperately need respectable, clean shelter at a price point they can afford.
Harvard Affordable Housing Study: