Is Housing Unaffordable? Why Isn't It More Affordable?housing is as affordable now, on average, as...

Is Housing Unaffordable Why Isnrsquot ItMore Affordable

John M Quigley and Steven Raphael

P ublic concern over the affordability of housing arises from two factorsFirst housing is the single largest expenditure item in the budgets of mostfamilies and individuals The average household devotes roughly one-

quarter of income to housing expenditures while poor and near-poor householdscommonly devote half of their incomes to housing These high proportions suggestthat small percentage changes in housing prices and rents will have large impactson nonhousing consumption and household well-being

Second many large US metropolitan areas have experienced recent andwell-publicized increases in housing prices and rents For example between 1995and 2002 the median home price increased by 65 percent (in nominal terms) inthe San Francisco Bay Area 62 percent in Boston 54 percent in San Diego and49 percent in Denver The comparable changes in rents for a standard two-bedroom apartment are 76 percent for San Francisco 61 percent for Boston49 percent for San Diego and 62 percent for Denver While these metropolitanareas represent the extremes median home prices and rents increased consider-ably in nearly all of the largest metropolitan areas

Housing affordability is regularly raised as a major policy concern mostrecently by the bipartisan Millennial Housing Commission (2002) But economistsare wary even uncomfortable with the rhetoric of ldquoaffordabilityrdquo which jumblestogether in a single term a number of disparate issues the distribution of housingprices the distribution of housing quality the distribution of income the ability ofhouseholds to borrow public policies affecting housing markets conditions affect-ing the supply of new or refurbished housing and the choices that people make

y John M Quigley is I Donald Terner Distinguished Professor and Professor of Economicsand Steven Raphael is Associate Professor of Public Policy both at the University of Califor-nia Berkeley Their e-mail addresses are quigleyeconberkeleyedu and raphaelsocratesberkeleyedu respectively

Journal of Economic PerspectivesmdashVolume 18 Number 1mdashWinter 2004mdashPages 191ndash214

about how much housing to consume relative to other goods This mixture of issuesraises dif culties in interpreting even basic facts about housing affordability Forexample the rapid rise in the price of homes clearly made homeownership moredif cult for many renters but it also greatly reduced the nancial costs of home-ownership to a much larger group of existing homeowners by providing substantialcapital gains Among renters the large share of income devoted to housing surelyre ects voluntary consumption choices for many households and the consumptionof a publicly determined minimum quality and quantity of housing for others Tothe extent that the latter group of households would choose a lower quality ofhousing given their opportunities one might conclude that the incomes of thepoorest households are insuf cient to afford the socially imposed minimum standard

This paper sorts out these issues We show that for the two-thirds of UShouseholds who own homes there is little evidence that housing has become lessaffordable in recent years For the one-third of US households who are rentersthe proportion of income that the median renter devotes to housing has increasedonly modestly However we nd pronounced increases in the typical rental bur-dens for poor and near-poor households Thus we examine the low-income rentalmarket in greater detail evaluating the contribution of changes in the incomedistribution increases in rental quality land-use regulation growth controls andzoning to the observed changes in rent burdens among low-income householdsWe end by sketching some policies that might improve the affordability of housingfor homeowners and for renters

Trends in the Rental and Owner-Occupied Housing Markets ThePast 40 Years

The majority of US households are homeowners and homeownership ratesin recent decades have trended upward for virtually all demographic groups By2000 two out of every three US households owned their dwellings Table 1presents homeownership rates for the period 1960 to 2000 for all households forquintiles de ned by household income and for poor households Over the pastfour decades aggregate homeownership rates increased by ve percentage pointsEven among households in the bottom quintile homeownership is quite commonIn 2000 45 percent of bottom-quintile households were homeowners as were37 percent of households with incomes below the poverty line

However income can be a misleading measure of housing affordability forexample many retirees have low annual incomes yet own their homes Thus Table2 presents more detailed tabulations of homeownership rates for the year 2000mdashfor households strati ed by income age of the household head and raceethnicityThese tabulations reveal several clear patterns First the high aggregate homeown-ership rates for poor and near-poor households evident in Table 1 re ect theconditions of older households with low incomes For many of these householdscurrent low incomes are likely re ective of retirement rather than material povertyFor the nonelderly poor and near poor homeownership rates are very low More-

192 Journal of Economic Perspectives

over there are pronounced racial and ethnic differences in homeownership rates (forexample the white-black difference in homeownership rates is 26 percentage points)

Tables 1 and 2 indicate that for the majority of American householdsmdashincluding more than two-thirds of those in the top three income quintilesmdashhousing ldquoaffordabilityrdquo refers to the terms on which dwellings can be purchasedand loans to purchase these assets can be amortized In contrast for households oflower incomes for the poor for minority households and for many young house-holds ldquoaffordabilityrdquo refers to the terms for rental contracts and the relationshipbetween these rents and their low incomes Hence we proceed by analyzingseparately trends in these two segments of the housing market

Table 1Homeownership Rates by Income Quintile and Poverty Status 1960 to 2000

1960 1970 1980 1990 2000

All households 61 62 65 64 66Income quintile

First 49 48 45 43 45Second 49 50 52 54 57Third 60 61 63 63 66Fourth 70 71 77 75 77Fifth 76 80 87 86 87

Poor households 48 46 39 36 37

Source For 1960 to 1990 the gures are tabulated from the Integrated Public Use Microdata Files For2000 the gures are tabulated from the American Community Survey Public Use Microdata Files

Table 2Homeownership Rates by Age Income Quintile Poverty Race and Ethnicity2000

Age of Head of Household

All Under 25 25 to 34 35 to 44 45 to 64 65 and over

All households 66 18 45 66 77 79Income quintile

First 45 9 20 32 50 66Second 57 18 32 49 66 82Third 66 25 46 64 76 89Fourth 77 30 60 77 86 91Fifth 87 38 68 87 92 93

Poor households 37 9 21 34 49 60Raceethnicity

White 71 20 50 71 81 81Black 45 8 26 43 58 65Asian 53 16 33 59 69 60Hispanic 45 15 31 49 59 64

Source Figures are tabulated from the 2000 American Community Survey Public Use Microdata Files

John M Quigley and Steven Raphael 193

Before proceeding however we must stress the limitation of affordabilitymeasures based on annual income Housing choices for both owners and rentersinvolve very substantial transactions costs Moreover housing choice anchors manyother consumption activities including schools neighborhoods and other publiclyprovided and natural amenities Thus housing choices are likely to be made basedon self-assessments of permanent income rather than current annual incomeMeasured annual income may be a noisy signal of the longer-run economiccircumstances that govern choice and households are unlikely to adjust housingconsumption in response to short-run uctuations in economic conditions Thisdistinction is recognized in the professional economics literature on housingmarkets familiar to specialists where considerable attention is paid to distinguish-ing between the higher long-run income elasticity of demand and the lowershort-run elasticity (This distinction dates back to the in uential work of MargaretReid 1962)

When housing affordability is measured by rent-income ratios based on annualincome affordability must be correlated with income Moreover housing willappear to be less affordable for the very young and very old it will appear to bemore affordable to households at the peak of their lifetime income pro les Insome part these re ect de nitional issues as well as behavioral consequences

Trends in the Costs of Owner-Occupied HousingThe affordability of homeownership is monitored by a variety of organizations

For example the National Association of Realtors (NAR) and the US Departmentof Housing and Urban Development (HUD) regularly compute the monthlypayments required to amortize a standard xed-rate mortgage on the averagehouse sold as a function of current house prices and interest rates The HUD indexof housing affordability shown in Figure 1 is the ratio of median family income tothe income required to qualify for a conventional mortgage on the median valuedhouse sold In the early 1970s the median household earned 50 percent more thanthat required to purchase the average house The period of high interest rates inthe late 1970s is clearly re ected in the index Since the early 1980s the afford-ability of owner-occupied housing increased by this measure Owner-occupiedhousing is as affordable now on average as in the early 1970s1

According to the HUD affordability index as incomes increase affordabilityincreases As in ation increases nominal interest rates and house prices increasewhich more than counterbalances any increases in nominal wages so that in ationmakes housing less affordable

1 Several other measures of affordability are worth a brief mention The NARrsquos ldquoHousing AffordabilityIndexrdquo is de ned as the ratio of 25 percent of median monthly income to the payment described abovea value of 100 indicates that by devoting 25 percent of income to housing a household of medianincome has exactly enough income to afford the median priced house sold The National Associationof Home Builders (NAHB) computes the fraction of dwellings sold that could be purchased by themedian household with 28 percent of household income The values of these indices are widely reportedin the business press Until 1995 the US Census estimated the fraction of households whose currentincomes would qualify them to purchase the median priced home in their region


To an economist however the affordability of owner-occupied housing is a bitmore complicatedmdashby taxes by depreciation and by capital gains Absent taxesand depreciation the annual user cost of a unit of housing capital is the realinterest rate i The value of the periodic ow of housing services R is related to thevalue of the home V by

R 5 iV

To an economist housing ldquorentrdquo R is the opportunity cost of using housing capitalfor one period iV alternatively the capitalized value of rent Ri equals the valueof the property V

Adding depreciation and maintenance expenditures at the annual rate dproperty taxes at rate t and capital gains at real rate g gives a new rent equation

R 5 ~i 1 t 1 d 2 gV

Property taxes and depreciation increase the user cost of housing while capitalgains reduce costs Note that the appreciation of housing prices has an ambiguouseffect on affordability For those who donrsquot own homes high prices make afford-ability more dif cult For incumbent owners appreciation in the price of homesdecreases the cost of owner-occupied housing In fact in many regional housingmarkets throughout the United States the rates of home price increase have beenlarge enough to reduce the true annual costs of homeownership to zero at least forsome periods

Federal taxes further complicate the costs and affordability of owner-occupiedhousing Since property taxes and interest payments on home mortgages are tax

Figure 1Housing Affordability Index 1970ndash2001

019751970 1980 1985 1990 1995 2000

20

40

60

80

100

120

140

160

180

Inde

x Va

lue

Source US Department of Housing and Urban Development

Is Housing Unaffordable Why Isnrsquot It More Affordable 195

deductible while capital gains on owner-occupied housing are (essentially) un-taxed federal tax policy reduces the user cost of capital Moreover the fact thatgeneral price in ation in uences nominal interest rates as well as nominal housingprice appreciation coupled with the deductibility of nominal interest paymentsmeans that in ation reduces the after-tax user cost of capital To see this add thein ation rate a to the prior equation for the value of the periodic ow of housingservices and then multiply the interest and property tax component by one minusthe marginal tax rate T This yields an expression

R 5 ~i 1 a1 2 T 1 t1 2 T 1 d 2 g 1 aV

which incorporates the deductibility of nominal interest payments and propertytaxes Rearranging the terms in this expression yields

R 5 R 2 ~i 1 a 1 tTV

where the new rental equation is equal to rents in the absence of the favorable taxtreatment (R) less an offset associated with the interest and property tax deduc-tion The offset provided by deductibility reduces the sensitivity of user costs tointerest rates and property taxes Taxes also mean that user costs are lower at highermarginal tax rates and they are also lower in an in ationary environment (Quigley1998 provides a more extensive discussion)

More generally this perspective indicates that the costs of homeownership canbe quite sensitive to macroeconomic stabilization policies and to the structure ofincome tax rates For example at plausible values of the variables in the previousequationmdashsay i 5 g 5 3 percent t 5 d 5 2 percent T 5 30 percentmdasha decreasein in ation from 6 percent to 1 percent doubles the after-tax user cost of residen-tial capital Similarly holding in ation constant at recent levelsmdashfor examplea 5 3 percent and as before I 5 g 5 3 percent t 5 d 5 2 percentmdasha decrease inthe marginal income tax rate from 40 to 20 percent increases the user cost of capitalby one-third Thus tax and monetary policies can cause substantial changes in thecosts of owner-occupied housing that are unrelated to the price of houses per se

Figure 2 presents rough estimates of the user cost of residential capital duringthe period 1978ndash1997 These estimates are derived from the time series on interestrates for newly issued xed rate mortgages (from Freddie Mac) and the temporalvariation in marginal tax rates (on an income of $40000 exercising theNBER model TAXSIM for each year) The calculations also assume d 5 4 percentand t 5 2 percent and they make no other allowances for risk premia or othercosts The gure presents two estimates one ignoring capital gains and oneincluding capital gains estimated as a three-year trailing average of national houseprice changes Ignoring capital gains these estimates show a rapid increase in usercosts of the late 1970s with a continuous decline since about 1982 When capitalgains in housing are included (albeit roughly) the user cost estimates are lowerand they are somewhat more volatile (Note that during the earliest period1978ndash1980 user costs were actually negative at least when anticipated capital gains


are reckoned) There is however no evidence that user costs have increasedappreciably even when capital gains are ignored Of course interest rates in theearly 2000s have been lower than in the period covered in Figure 2 furtherreducing user costs

Trends in the Costs of Rental HousingThe median renter saw a substantial increase in the share of income spent on

housing in the 1970s but little change since then However for those at lowerincome levels rent has been taking a larger share of income

Table 3 presents alternative measures of the affordability of rental housing forthe period 1960 to 2000 median rent-to-income ratios2 and the proportion ofhouseholds who spend more than 30 percent of income on rent We choose the30 percent benchmark since most government housing assistance programs subsi-dize housing costs so that the housing expenditures of recipients do not exceed30 percent of household income3 We present gures for all renter households forrenter households strati ed by quintiles of the household income distribution andfor poor households In 1960 and 1970 the median renter devoted 20 percent ofincome to rent By 1980 this gure increased to 25 percent and it subsequentlyrose slightly Similar patterns are observed for the proportion of renter households

2 Other studies have calculated rent-to-income ratios using alternative data sources and sample speci -cations See Burt (1992) Jencks (1994) and Orr and Peach (1999)3 Prior to 1982 these subsidies were xed so that subsidized households spent 25 percent of theirincomes on shelter Other programs set different norms For example the Federal Housing Adminis-tration (FHA) mortgage program for homeowners currently sets a house-payment-to-income standard of28 percent

Figure 2User Cost of Housing Capital 1978ndash1997

261980 1982 1984

Including capital gainsIgnoring capital gains

1986 1988 1990 1992 1994 19961978

24

22

0

2

4

6

8

10

12

14

16

Use

r C

ost i

n P

erce

nt

Source See text for de nitions and assumptions


spending greater than 30 percent of incomes on housing costs although for thismeasure the post-1980 increases are pronounced

The increases in the median rent-to-income ratio coupled with the increase inthe proportion of renter households in the upper tail of the rent-to-incomedistribution suggests that inequality in rent burdens has increased over the pastfour decades Standard measures of inequality con rm this intuition For examplecomparisons of the rent-to-income ratios at the 90th and 10th percentiles of thedistribution indicate an increase in dispersion For 1960 the 9010 ratio was 591This increased to 676 in 1980 and to 706 in 2000

Beyond these aggregate trends the tabulations by household income quintilereveal two distinct regularities First in all years the proportion of income devotedto housing costs is far larger among low-income renters than among high-incomerenters The most extreme rent burdens are observed for poor households(roughly the bottom 12 percent of households) In 2000 the median poor renterhousehold devoted 64 percent of income to rent (As measured by the US Censusldquoincomerdquo includes all cash transfers such as welfare payments but it excludesin-kind bene ts such as subsidized medical insurance) Among poor households77 percent devoted more than 30 percent of their incomes to housing costs while57 percent spent over half their incomes for housing

Table 3Rent Burdens of Renter Households by Income Quintile and Year

1960 1970 1980 1990 2000

A Rent as a percentage of household income

All renters 19 20 25 26 26Income quintile


Poor renters 44 57 63 63 64

B Percentage of renters devoting more than 30 percent of income in rent




Source For 1960 to 1990 the gures are tabulated from the Integrated Public Use Microdata Files For2000 the gures are tabulated from the American Community Survey Public Use Microdata FilesNote Quintiles are de ned using the household income distribution for all households (renters andhomeowners combined)


Second households in the lower quintiles of the income distribution experi-enced much greater increases in rental costs relative to income when comparedwith relatively wealthier renter households From 1960 to 2000 the rent-to-incomeratio for the median renter in the bottom quintile increased from 047 to 055while the proportion spending more than 30 percent of income on rent increasedfrom 062 to 079 Increases in these proportions were considerably more moderatefor renter households in the middle quintile and negligible for households in thetop quintile

An alternative metric often employed in descriptive analyses of housing afford-abilitymdashfor example in the Department of Housing and Urban Developmentrsquos(2000) ldquoWorst Case Housing Needsrdquo reportmdashis the proportion of the rental stockthat is ldquoaffordablerdquo to renters within a given income class relative to the size of therelevant population of renters For the period 1960 to 2000 Table 4 reports theproportion of housing units with rents that are less than 30 percent of the incomeof the median renter These tabulations are provided for all renters for renters byincome quintiles and for poor renters The proportion of renter households thatfall into each category is included in parentheses

The proportion of the rental housing stock that is affordable in this sense tothe median renter has declined markedly Between 1960 and 2000 the proportionof dwellings renting for 30 percent or less of renter median income declined from083 to 062 Again this erosion is concentrated in the bottom of the incomedistribution although the decline in affordability is also evident for renters in themiddle quintile Over this time period the percentage of renters concentrated inthe bottom quintile increased from 29 to 34 percent These patterns suggest a

Table 4Percentage of Rental Stock Affordable to Households with the Median RenterrsquosHousehold Income the Median Renterrsquos Income Within Quintilesa and theMedian Renterrsquos Income for Poor Renters(percentage of renter households in each category is shown in parentheses)

1960 1970 1980 1990 2000

Percentage of units renting for less than 30 percent of the median renterrsquos income

All renters 83 (100) 84 (100) 70 (100) 63 (100) 62 (100)By quintile

First 13 (27) 13 (28) 15 (33) 12 (33) 7 (32)Second 65 (26) 69 (26) 59 (27) 53 (25) 50 (26)Third 92 (20) 95 (21) 92 (20) 87 (20) 88 (20)Fourth 99 (16) 99 (15) 99 (13) 97 (14) 98 (14)Fifth 100 (11) 100 (11) 100 (7) 100 (8) 100 (8)

Poor renters 13 (27) 12 (22) 12 (22) 9 (22) 4 (23)

Source For 1960 to 1990 the gures are tabulated from the Integrated Public Use Microdata Files For2000 the gures are tabulated from the American Community Survey Public Use Microdata Filesa Quintiles are de ned using the household income distribution for all households (renters andhomeowners combined)


substantial undersupply of rental dwellings available for low-income householdseven those willing to devote a large fraction of income to rent

Explaining Trends in Low-Income Housing Markets

Since affordability measures depend on both housing costs and incomestrends in the distribution of income are potentially important in explaining theincrease in housing costs and rent burdens experienced by poor and near-poorhouseholds For example there is now a large literature documenting increases inearnings inequality around a stagnant mean during the 1980s (Levy and Murnane1992 Reed Glenn-Haber and Mammeesh 1996 Freeman and Katz 1994) Iflow-income households permanently lost ground during this period in terms of realincome changes in the income distribution would have increased the rent burdensfor this segment of the income distribution4

Concurrently increases in rents can be caused by an increase in the qualityandor quantity of housing consumed or by increases in the price of a quality-adjusted unit of housing Factors that may in uence the quantity or quality ofhousing consumed by the poor are changes in income tastes and governmentregulations that mandate minimum quality housing standards Factors that mayin uence quality-adjusted price may include land-use regulations that decrease thesupply of low-income housing or demographic factors such as the aging of the babyboomers or immigration that alter demand

Is Rental Housing Less Affordable Because Incomes Have Changed Over TimeIn Table 5 we decompose the decade-by-decade affordability changes (from

Table 4) into two componentsmdashthe change in affordability due to changes in rentsholding incomes constant and the change in affordability due to changes inincome holding the distribution of rents constant Estimates are provided for allrenters for renters in the bottom two quintiles of the household income distribu-tion and for poor renters

For all renters the proportion of units affordable at 30 percent of income wasstable during the 1960s declined during the 1970s (by 14 percentage points)declined further during the 1980s (by 7 percentage points) and was stable duringthe 1990s Increases in rents accounted for 8 of the 14 percentage point reductionduring the 1970s while the remaining 6 percentage points is attributable to adecline in the real median incomes of renters During this decade real incomesincreased for all households (renters and owners combined) in all quintiles whilehomeownership rates increased considerably for the top four income quintiles (as

4 Increases in income inequality per se may also increase the price of low-income housing OrsquoFlaherty(1995) models the impact of increased inequality on the housing price-quality pro le An increase inincome inequality reduces the demand for middle-quality housing and increases the demand forlow-quality housing as households experiencing declines in real income reduce their demand forhousing


shown earlier in Table 1) These facts suggest that nearly half of the decline in theaffordability of rental dwellings during the 1970s is attributable to a decline in themedian income of renter households which in turn was caused by a selective shiftof better-off households into homeownership During the 1980s and 1990s how-ever all of the declines in affordability arose from shifts in the rental distributions

Table 5Decomposition of Decade-by-Decade Changes in the Percentage of Rental UnitsAffordable to the Median Renter to All Renters to Renters in the BottomQuintiles and to Poor Renters(in percentage points)

Change 1960 to 1970 Overall change Due to rents Due to income

All renters 1 28 9Quintile 1 0 0 0Quintile 2 4 214 18Poor renters 21 21 0







Notes The decompositions are calculated as follows Let F2000 be the 2000 rental cumulative densityfunction (cdf) F19 90 be the 1990 rental cdf affordable2000 be equal to 30 percent of the income of themedian renter in 2000 affordable1990 be equal to 30 percent of the income of the median renter in1990 P2000 be the proportion of rental units renting for less than affordable2000 and P1990 be theproportion of rental units renting for less than affordable1990 Both affordable2000 and affordable1990 aremeasures in 1990 dollars The change in the proportion affordable between 1990 and 2000 is given bythe equation Change 5 P2000 2 P1990 5 F2000(affordable20 00) 2 F19 90(affordable1990) Add and subtractthe 1990 rental cdf evaluated at the 2000 affordable rent threshold to get Change 5F2000(affordable20 00) 2 F1990(affordable2000) 1 F1990(affordable2000) 2 F1990(affordable1990) 5[F2 000(affordable2000) 2 F1990(affordable2000)] 2 [F1990(affordable1990) 2 F1990(affordable2000)] The rst term is the change in the proportion affordable arising from the change in the rental cdf aroundthe 2000 affordability threshold The second term is the change in the proportion affordable holdingthe rental distribution constant in 1990 and allowing the affordability threshold to change


toward higher priced dwellings with increases in median income providing amodest offset to these rent increases

For poor and bottom-quintile households the largest declines in the propor-tion of housing affordable to the median renter occurred during the 1980s and1990s During the 1980s real income declines contributed modestly to the de-creases in affordability During the 1990s nearly all of the declines in the afford-ability are attributable to increases in rents Note in nearly all cases rent distribu-tions have shifted to the right With the exception of the large change in medianincome of renters during the 1970s (a change that is more of an artifact ofbetter-off renters becoming homeowners rather than a real decline in purchasingpower) most decreases in affordability are attributable to higher rents not lowerincomes

Do Quality Improvements Explain the Rent Increases of the Past Four DecadesBy most measures improvements in the quality of rental housing in America

have been quite substantial Forty years ago for example one- fth of the rentalunits in the United States lacked complete plumbing facilities like hot water sinksand ush toilets In 2000 only one rental unit out of 200 did not have completeplumbing facilities Among the rental dwellings occupied by the poorest quintile ofUS households dwellings without plumbing facilities declined from 40 percent ofthe stock four decades ago to nearly zero percent Similarly nearly all rental unitscurrently have complete kitchen facilities Moreover the sizes of rental units havealso increased considerably since 1960 The proportion of one-room rentals de-clined from 58 percent to 39 percent for all rentals and from 115 percent to59 percent for those occupied by bottom-quintile renters In addition the propor-tion of low-quality rentals with four or more rooms increased by 102 percentagepoints The percentage of rentals with three or more bedrooms increased by27 percentage points while for the lowest income quintile the percentage in-creased by 58 percentage points5

Other aspects of quality have improved as well Orr and Peach (1999) docu-ment that between 1975 and 1997 the proportion of rental units they classi ed asldquoinadequaterdquomdashde ned as units with physical defects or faulty plumbing electricityor heatingmdash decreased considerably as did the proportion classi ed as ldquoover-crowdedrdquo Moreover the improvements in dwellings occupied by poorer renterhouseholds were larger than the improvements in other dwellings The one mea-sure of housing quality where substantial differences remain across income quin-tiles is the self-assessment by residents of the quality of their neighborhoods

For owner-occupied dwellings the trends in quality are parallel Plumbing andkitchen facilities size as well as measures of structural adequacy all improvedconsiderably over the past four decades

Figure 3 presents evidence on the course of owner-occupied housing pricesand the importance of quality changes during the past quarter-century The solid

5 See Quigley and Raphael at httpurbanpolicyberkeleyedu for details and documentation of thesequality changes


line shows the median price of existing housing while the line with heavier longdashes shows median selling price of new housing Both are normalized by theconsumer price index for other goods (that is the CPI-U minus its shelter com-ponent) and indexed to 1968 prices The real prices of existing housing increasedby about 13 percent per year during the period while new home prices increasedby about the same amount (but with more variation) The gure also presents a lineof short dashes showing estimates of the real price of a new constant-quality houseof 1992 characteristics during the period 1977ndash1999 which is produced usinghedonic methods by the US Census Bureau As is clear much of the increase inreal prices has arisen from quality change For example a new dwelling with 1992features but purchased in 1980 would have cost almost 15 percent more in realterms than the median new dwelling sold in 1980 During the period 1977ndash1999the real price of a constant quality home increased about 03 percent per year whilethe median sales price of a new house increased by about 11 percent per year

The evidence on characteristics of rental and owner-occupied housing suggeststhat quality increases are an important factor in explaining higher prices of housingstock

Does the Increased Quality of Rental Housing Stem from Demand orGovernment Rules

Does the improvement in the quality of housing for low-income renters resultfrom increases in demand for housing amenities among low-income households orfrom supply-side restrictions that impose minimum habitation standards on newand existing units or both It is not hard to imagine that households in the lower

Figure 3Real Price of New Existing and New Constant-Quality Houses(in 1968 dollars)

0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10

15Real Existing House PriceReal New House PriceReal Price of Constant Quality New House

20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars

Source US Department of Housing and Urban Development US Census Bureau


tail of the income distribution are willing to pay handsomely for basic amenities likeindoor plumbing or hot water as their incomes rise However the rise in rentburdens suggests that either the income elasticity of demand for housing amongthe poor is exceptionally high or that other forces are at work Estimates of housingdemand by renters yield income elasticities less than one indicating housingconsumption should grow at a slower rate than income6

It seems plausible that much of the increase in quality of rental units has beenabetted by government restrictions Habitation standards generally preclude build-ing new dwellings without basic amenities such as private kitchens completeplumbing and multiple exits Standards typically do not permit shared facilities(and as we note below this form of construction would not be pro table anyway)Increased habitation standards affect the quality and quantity distribution of therental stock through other avenues as well For example these standards may beenforced through local zoning ordinances that reduce density impose minimumdwelling and lot size requirements or impose other restrictions that increase theminimum quality of new units (Fischel 1985)

The Urban Renewal Program beginning in 1949 and its successors up to theearly 1970s are widely perceived to have increased the minimum quality of housingand reduced the stock of housing in many urban areas These programs providedsubsidies to local governments to acquire and demolish occupied property (mostlyolder housing units and small businesses) under the power of eminent domain tocreate new housing and public facilities In his textbook summary of urban renewalOrsquoSullivan (1996) notes that the redevelopment programs removed 600000 low-income dwellings from the housing stock and added 250000 new dwellings mostlytargeted toward middle- and upper-income households The program affecteda relatively small fraction of the stock of rental units less than 5 percent butalmost all of the units targeted for demolition were in the bottom of the qualitydistribution

Quality enhancements caused by public interventions such as zoning ordi-nances or urban renewal are likely to raise the level of housing consumption oflow-income households above the levels they would otherwise choose The way inwhich quality enhancements can make those with low incomes worse off is perhapsmost vivid when minimum standards price the poorest households out of themarket and increase the number of households that are homeless or at risk of

6 Using the CPI de ator for all urban consumers between 1960 and 2000 real median householdincome for renters in the bottom quintile of the household income distribution increased by 38 percentConcurrently real rents increased by 50 percent If all rent increases above the overall in ation ratere ected increases in housing quality and if all increases in quality of housing consumed re ected thevoluntary choices of renter households then the income elasticity of demand for housing by renters inthe bottom quintile can be calculated by simple arithmetic But this calculation suggests an income ofelasticity of demand for housing of 13 among bottom quintile renter households This computation lieswell above the range of scienti c estimates In an early review Mayo (1981) summarized prior researchreporting a maximum of 070 for renters and 087 for owners From an explicitly dynamic modelHanushek and Quigley (1982) estimated elasticities for renters of 06 In a later review Malpezzi andMayo (1987) concluded that credible estimates of the income elasticity of housing demand lie between05 and 1


becoming homeless7 But even for poor households whose circumstances are lessdesperate increases in housing quality caused by regulation may still reduce overalleconomic welfaremdashat least as long as the preferences and paternalism of thenonpoor with regard to the quality of housing occupied by others are not given toomuch weight

How Government Building Restrictions Increase Housing PricesIncreases in housing rents do re ect increases in quality but they also re ect

higher prices even after adjusting for quality Holding quality constant the price ofa given rental unit depends on factors in uencing the overall supply of rentalhousing as well as demographic and economic determinants of market demandThis section will focus on the supply side of the housing market in which the mostimportant determinants of the quantity of rental housing are construction qualityvintage and depreciation The next section will focus on factors in uencing thedemand for low-income rental housing including income preferences and chang-ing demographic conditions

Economists studying housing refer to a process of ldquo lteringrdquo by which housingunits move through a quality hierarchy either through depreciation in excess ofmaintenance outlays or investments to upgrade dwellings The total supply ofrentals is jointly determined by new construction at all quality levels the rates atwhich units lter through the quality hierarchy and the rate at which units areremoved from the rental stock via abandonment and conversion to other usesSweeney (1974) and OrsquoFlaherty (1995) offer powerful models of this process Theprocess of ltering is especially important for low-income rental housing becausenew construction at higher quality levels tends to be more pro table than newconstruction of low-quality housing for reasons linked to depreciation and dura-bility (OrsquoFlaherty 1995 1996) Through the process of ltering the supply ofbottom-quality housing is dependent on new housing construction at all levels notjust newly built ldquoaffordable housingrdquo Malpezzi and Green (1996) demonstrate thatmetropolitan area growth in the quantity of low-quality housing units is quitesensitive to the quantity of new higher-quality housing supplied In their words thispattern indicates that ldquoto the extent that a city makes it easy for any [emphasisadded] type of housing to be built it will also enhance the available stock oflow-cost housingrdquo

The converse is also true to the extent that cities make it dif cult to build newhousing any type of new housing the availability of low-cost housing will be reducedand the affordability of all housing will decline Indeed many cities complicate andadd costs to the process of building new housing Perhaps the most extremebarriers to new housing come in the form of explicit growth controls Municipal

7 Many have argued that the removal of low-quality rentals (for example single-room occupancydwellings) via urban redevelopment as well as minimum quality standards imposed through localhousing ordinances are directly responsible for the rise in homelessness in the United States during the1980s (Burt 1992 Rossi 1989) For more recent evidence on the link between housing costs andhomelessness see Quigley Raphael and Smolensky (2001)


growth control measures may take the form of moratoria on new developmentsurban growth boundaries beyond which development is severely curtailed or openspace requirements intended to preserve undeveloped land (Schill 2001) An earlyreview of the empirical research on growth controls concluded that these measuresincrease housing prices in the municipalities that impose restrictions have spillovereffects on housing prices in neighboring municipalities without such restrictionsand reduce the value of undeveloped land that has become subject to restrictiveregulation (Fischel 1990) More recent research based on large surveys of Califor-nia municipalities nds similar results (Levine 1999)

Land-use regulations that reduce housing supply and increase housing pricesinclude a wide variety of local ordinances In the previous section we noted thatzoning ordinances are responsible in part for increasing the minimum quality ofthe existing rental stock However many zoning ordinances also reduce the supplyof housing by arti cially increasing land requirements and by allocating land awayfrom residential uses For example municipalities often set minimum lot sizes fornew single-family homes with the aim of reducing density and controlling thedemand for public services In addition many municipalities have communityldquomaster plansrdquo that reserve large portions of undeveloped land for commercial usesthat generate local tax revenue yet require little spending on public services suchas education These examples of ldquo scal zoningrdquomdashzoning designed to minimize the scal impact of land usesmdashreduce the quantity of land available for housingrestrict the housing supply and thus increase housing prices in the regulatedmunicipalities as well as in neighboring towns Not surprisingly empirical researchon the economic impacts of zoning ordinances indicates that these rules tend toincrease housing prices and reduce new housing construction (Thorson 19961997)8

Several studies have estimated the impact of the overall municipal regulatoryenvironment on housing supply and prices Using aggregate data for US metro-politan areas Mayer and Somerville (2000) found that heavily regulated areas haveconsiderably lower levels of new housing construction and that housing supplyelasticities are considerably lower in more heavily regulated metropolitan areasGreen Malpezzi and Mayo (1999) found a similar relationship between supplyelasticities and the degree of land-use regulation across US metropolitan areaswhile an international comparison of housing supply elasticity estimates (Mayo andSheppard 1996) reported larger elasticities in less heavily regulated nationalhousing markets A number of studies have found strong relationships between theoverall degree of land-use regulation and housing prices (for example Green1999 Malpezzi 1996 Pollakowski and Wachter 1990)

8 Theoretically zoning may increase housing prices by both reducing the supply of housing as well asincreasing the demand for housing in the zoned community The original motivation behind zoningordinances was to prohibit the co-location of incompatible uses of land largely to separate and isolateactivities that generate negative externalities for residents (Fischel 1985) Hence a zoned community islikely to be desirable to many a fact that should be re ected in housing values However the fact thatland-use regulations in one municipality create spillover effects on housing prices in neighboringmunicipalities suggests that these regulations reduce the supply of housing


One rough way to estimate the extent to which urban land use and zoningregulations have in ated housing prices is to consider the relationship betweenhousing prices and the nonland components of input costs Time series data on thenominal costs of labor and materials for a house whose quality is speci ed byengineering criteria can be pieced together from two commercial sources R SMeans and Saylor Inc9 Figure 4 presents these two input cost series benchmarkedto 1968 together with the price of new houses From 1968 up to about 1985nominal new house prices increased roughly in proportion to the hard nonlandcosts of construction But starting in the mid-1980s new house prices increased bymore than either of these price indices so that by 1999 new house prices had risento about 25 percent above the level of the underling input prices As we have notedpart of this divergence certainly re ects quality improvements (The data underly-ing Figure 3 suggest that a little over half is due to quality improvement) Part surelyre ects urbanization and increased competition for land But a large part probablyrepresents increased land costs arising from regulatory restrictions on new con-struction The impact may be especially large for the low-quality housing marketMalpezzi and Green (1996) quanti ed the impact of metropolitan-wide measuresof regulatory restrictiveness on rents for the bottom middle and third quartiles ofmetropolitan rental markets Their regression results indicate that moving from arelatively unregulated to a highly regulated metropolitan area increases bottom-quartile rents by more than a fth and bottom-quartile house values by more than

9 See Glaeser and Gyourko (2002) for a discussion of the R S Means data and for a cross-sectionalanalysis by region

Figure 4Nominal House Prices and Construction Costs

0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds

Nominal Price of New HouseRS Means Cost IndexSaylor Cost Index

Source US Department of Housing and Urban Development RS Means Building ConstructionCosts Saylor Publications Residential Construction Costs


three- fths The largest price effects of such regulations occur in the market forlow-quality housing

There are no studies that assess the contribution of land-use regulation per seto the increases in rent burdens experienced by low-income households Nonethe-less a substantial body of empirical literature consistently nds large effects ofland-use regulation and restrictions on housing prices and rents A precise andexplicit evaluation of the contribution of land-use regulation in explaining theincreased rent burdens of the poor would be a fruitful area for future research

Demographic Trends and Rental MarketsOn the demand side of the rental market several long-term demographic

trends are likely to in uence quality-adjusted rents On the one hand the native-born population continues to age As is evident from the pro le of age and housingstatus reported in Table 2 an aging population should help relieve demand-sidepressure in the market for low-quality rentals

At the same time international immigration to the United States has contrib-uted greatly to the growth of the nationrsquos population over the past two decades andhas altered the internal age distribution Moreover the household income distri-bution for the immigrant population is disproportionately concentrated at lowincome levels relative to the distribution for the native-born Both factors suggestthat recent immigration trends may put upward pressure on rents for low-qualityrental units (especially in metropolitan areas with large immigrant populations)

Two recent studies document the effect of large-scale immigration on housingcosts in the short run Susin (2001) and Saiz (2003) independently exploited anatural experiment rst studied in the context of labor markets by Card (1990) toestimate the impact of immigration on housing costs Both authors assessedwhether housing prices and rents increased in Miami after the large increase in theMiami immigrant population resulting from the ldquoMariel boatliftrdquomdashwhen Cubaallowed 125000 refugees to leave for Miami over a period of ve months in 1980Susin and Saiz found sizable short-term impacts of the population increase onhousing prices Again the effect of immigration on housing costs in the UnitedStates is a question deserving further research

Concluding Thoughts What Can Be Done

What can be done to make housing more affordable For the owner-occupiedsector lack of affordability is a problem for younger households Here modestchanges in institutional arrangements could greatly affect the affordability ofhomeownership especially for young households whose incomes will increase overthe life cycle For low-income renters more aggressive policy is needed

Policies to Facilitate HomeownershipAs noted above levels of homeownership are high and they have been drifting

upward continuously during the past four decades These outcomes are widelyapplauded by those who see a link between federal tax expenditures on


homeownership and ful llment of the ldquoAmerican dreamrdquo These trends in home-ownership are also applauded by those who see positive social externalities arisingfrom owner occupancy In fact however there is only a small effect of tax expen-ditures on homeownership There is perhaps a bit more to the neo-Marxist notionthat homeownership increases political participation (DiPasquale and Glaeser1999) and other desirable social outcomes (Haurin Parcel and Haurin 2002) Butthe evidence of externalities from homeownership is not overwhelming

Federal tax expenditures on homeownership like the deductability of mort-gage interest payments and local property taxes and the special treatment of capitalgains from housing are largemdash estimates for 1999 range from $562 to $720 billion(Voith 1999) Ironically the deductions have only a small effect on homeowner-ship because the elasticity of homeownership with respect to price is quite small(Rosen Rosen and Holtz-Eakin 1984 present the canonical empirical analysis) Amore productivemdashand far less expensivemdashfocus on homeownership would be onexpansion of mortgage instruments

Most mortgage underwriting criteria consider only current income Mostyoung households have income levels that are relatively low compared to theirlong-run prospects The effects of these institutional constraints are even morepronounced in in ationary environments For example during the 1975ndash1985period high interest rates precluded home purchase by many younger householdsat exactly the time when the true user costs of housing were low or even negativeBut this insight also suggests possibilities for rethinking mortgages in ways thatwould encourage homeownership among the young

Improvements in underwriting techniques achieved by reliance upon broadermeasures of borrower creditworthiness can increase the opportunities for home-ownership among households with lower annual incomes (Gates Perry and Zorn2002) as better credit risks can be identi ed Limited programs involving creditcounseling and risk-based pricing have expanded ownership opportunities forthose with lower current incomes without eroding the pro tability of lending(Hirad and Zorn 2002)

With a xed-rate mortgage payments are xed in nominal terms over timeWith an adjustable-rate mortgage the payments will rise or fall over time accordingto movements in interest rates But the more natural pattern for mortgage amor-tization is in ldquograduated paymentsrdquo in which the contracted monthly paymentsincrease over time as do the expected incomes of younger households over the lifecycle With adjustable interest rates these mortgages do raise a possibility ofldquonegative amortizationrdquo where in the rst few years the amount that it would taketo pay off the mortgage in full might increase But quite modest increases innominal house prices in the rst few years make negative equity quite rare

Longer amortization periods would reduce monthly payments and allowhouseholds of lower current incomes to qualify for loans In states with highhousing prices like California 35 and 40 year mortgages are becoming commonin European countries even longer terms are common See Maclennan Muell-brauer and Stephens (1998) for a survey of mortgage institutions in EU countries

More ambitious institutional rearrangements have been proposed For


example partnerships have been proposed in which an outside investor or syndi-cate puts up some fraction of the purchase price of a house and the homeowneramortizes only the residual fraction perhaps over a 30-year term Caplin ChanFreeman and Tracy (1997) discuss one concrete example The passive investorwould then share in capital appreciation at the time of sale or transfer according tosome schedule re ecting the investments of the two parties Poorer householdswould bene t from lower payments in exchange for reduced capital appreciationEven richer households who could more easily amortize the full purchase pricecould bene t from the increased diversi cation provided by the contractual rela-tionship The shared appreciation mortgage programs offered by a number of rms and universities to their employees are other examples of this relationship

Making Rentals More AffordableRental housing can be made affordable to low-income households through

policies that increase housing supply or those that augment the purchasing powerof poor households

The case for a supply-side response removing barriers to construction ofhousing for high-income as well as low-income families is clear As discussedearlier local land use regulations drive up rents and force poorer households tospend large fractions of their incomes on shelter However the political dynamicsof reform are very dif cult Homeowners dominate most governments outside ofcentral cities It is in the self-interest of these homeowners to oppose the develop-ment of higher density housing in their jurisdictions much less to encourageproduction of new dwellings of lower quality termed ldquoaffordable housingrdquo The scal reasons for this opposition were termed the ldquoHomevoter Hypothesisrdquo byFischel (2001) Consumers of small quantities of housing pay little in local taxesthey may consume larger quantities of locally nanced public services Homevotersalso fear that being surrounded by lower-priced housing may bring down their ownproperty values Moreover there is a fear that higher-density dwellings for lower-income residents are more likely to include those of differing race ethnicity andlanguage Finally there are increasingly respectable reasons for cloaking thisself-interest in the common ecological good The rhetoric of ldquosmart growthrdquo isespoused by ecologists and advocates to impede suburban development and theconcept has widespread support among professional planners Open space green-belt and urban growth boundary regulations are but a few of the names used todescribe building and density restrictions that reduce housing opportunities

It is unreasonable to expect that the capacities of local governments to impederesidential development will be curtailed by local homevoters This would requireaction by a higher regional authority or by state government Most states haveshown little interest in pursuing reforms of this kind

California may be the clearest example of the window-dressing approach tothis issue By law each California jurisdiction must produce a ldquohousing elementrdquowhich requires zoning enough land for higher density construction to meet astate-provided forecast of demand by income segment There are no penalties forfailing to produce a housing element in compliance with state guidelines in fact


there are no penalties for failing to produce a housing element at all Afterproducing a plan and zoning some land for higher densities there is nothing tocompel California jurisdictions to grant permission to build on the land so zoned

With limited ability to increase supply policies to augment demand can be lesseffective Only a fraction of households deserving of assistance on income groundsreceive housing assistance and in tight markets many program participants nd itdif cult to locate and acquire acceptable units on the private market

Table 6 presents data that we think is at the center of popular concern It

Table 6Summary of Renter Households and Housing Market Needs(thousands)

Fiscalyear

Number ofrenter

households

Number ofhouseholdsin severely

inadequate housing

Number ofhouseholdspaying 30ndash

50 income

Number ofhouseholds

paying 50income

Number ofhouseholdsin poverty

Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a

Sources US Department of Housing and Urban Development Of ce of Budget Annotated Tables forthe 1998 Budget Process Congressional Budget Of ce Tabulations based on Congressional Justi ca-tions for the Department of Housing and Urban Development US Department of Housing and UrbanDevelopment Of ce of Policy Development and Research Tabulations of American Housing SurveysAmerican Housing Survey Series H-150 various years Housing Vacancy Survey Series H-111 variousyears March Current Population Survey various years The Green Book various years US GeneralAccounting Of ce Changes in Rent Burdens And Housing Conditions Of Lower Income HouseholdsWashington DC US GPO (1985) Quigley (2000)Notes Prior to 1978 the AHS did not report rent-to-income ratios beyond the 35 percent 1 category Dataon rent burdens and inadequate housing units prior to 1981 are taken from GAO (1985) and represent onlyhouseholds with less than 80 percent of median area incomes AHS survey design and denitions of severeand moderate problems changed in 1985 so caution should be used in interpreting trends Subsidizedhouseholds include those in Public Housing Section 8 Section 236 and Rent Supplement programsNumber of subsidized households after FY 1980 re ects subtraction of units receiving more than one subsidy(ie Section 236 projects that also receive either Rent Supplement or Section 8 subsidies)a Estimate


documents the number of renter households in severely inadequate housing andthe number paying more than 30 percent of income on rent for each year duringthe past quarter-century The table also presents the number of households inpoverty and the number of renters subsidized by federal housing programs As thetable indicates the incidence of severely inadequate housing has been reduced byalmost two-thirds during this period and the incidence of poverty among rentalhouseholds has declined But the number of renter households paying 30 to50 percent of income on rent has increased by 3 million and the number of rentalhouseholds paying more than 50 percent of income on rent has increased byanother 36 million In contrast the total number of renter households receivinghousing subsidies from the federal government has increased much more mod-estly Since 1978 the number of households paying more than 30 percent ofincome on rent increased by 64 million The number of federally subsidizedhouseholds increased by 27 millionmdashabout two- fths of the increase in householdswith severe rent burdens Currently there are 73 million renters in poverty Allfederal rental programs provide subsidies to 51 million households

During the 1970s and 1980s the United States conducted the largest socialscience experiment in history the Experimental Housing Assistance Program(EHAP) These housing allowance programs provided cash assistance to familiesfor housing with the amount determined by the gap between some share of thefamilyrsquos income and the cost of standard housing in that area A range of experi-ments were carried out in a number of cities some focused on the effect of theallowances on housing consumption and household behavior some focused on theeffects of allowances on the supply of housing to low-income households and somefocused on different administrative arrangements The results of the experimentdemonstrated rather conclusively that if phased in carefully universal shelterallowance programs need not drive up rents (for example see the papers inBradbury and Downs 1982 Friedman and Weinberg 1983) Nothing was done toimplement the program at the time and the concept of a universal housingallowance program seems even less politically feasible today

y We are grateful for the comments of Brad De Long Andrei Shleifer Michael Waldman andespecially of those of Timothy Taylor Financial support was provided by the Berkeley Programon Housing and Urban Policy Matthew Stokes provided able research assistance


References

Bradbury Katherine and Anthony Downs eds1982 Do Housing Allowances Work WashingtonDC Brookings Institution

Burt Martha 1992 Over the Edge The Growth ofHomelessness During the 1980s New York NYRussell Sage Foundation

Caplin Andrew Sewin Chan Charles Free-man and Joseph Tracy 1997 Housing Partner-ships Cambridge Mass MIT Press

Card David 1990 ldquoThe Impact of the MarielBoatlift on the Miami Labor Marketrdquo Industrialand Labor Relations Review 432 pp 245ndash57

DiPasquale Denise and Edward L Glaeser1999 ldquoIncentives and Social Capital Are Home-owners Better Citizensrdquo Journal of Urban Econom-ics 452 pp 354ndash84

Fischel William A 1985 The Economics of Zon-ing Laws A Property Rights Approach to AmericanLand Use Controls Baltimore John Hopkins Uni-versity Press

Fischel William A 1990 Do Growth ControlsMatter A Review of Empirical Evidence on the Effec-tiveness and Efciency of Local Government Land UseRegulation Cambridge Mass Lincoln Instituteof Land Policy

Fischel William A 2001 The Homevoter Hypoth-esis How Home Values Inuence Local GovernmentTaxation School Finance and Land-Use PoliciesCambridge Mass Harvard University Press

Freeman Richard B and Lawrence F Katz1994 ldquoRising Wage Inequality The UnitedStates vs Other Advanced Countriesrdquo in WorkingUnder Different Rules R B Freeman ed NewYork NY Russell Sage Foundation pp 29ndash36

Friedman Joseph and Daniel H Weinbergeds 1983 The Great Housing Experiments BeverlyHills Calif Sage Publications

Gates Susan Wharton Vanessa Gail Perry andPeter M Zorn 2002 ldquoAutomated Underwritingin Mortgage Lending Good News for the Un-derservedrdquo Housing Policy Debate 122 pp 369ndash92

Glaeser Edward L and Joseph Gyourko2002 ldquoThe Impact of Building Restrictions onHousing Affordabilityrdquo Federal Reserve Bank ofNew York Economic Policy Review June pp 1ndash19

Green Richard K 1999 ldquoLand Use Regula-tion and the Price of Housing in a SuburbanWisconsin Countyrdquo Journal of Housing Economics82 pp 144ndash59

Green Richard K Stephen Malpezzi and Ste-phen K Mayo 1999 ldquoMetropolitan Speci c Es-timates of the Price Elasticity of Supply of Hous-ing and Their Sourcesrdquo University ofWisconsin Madison Center for Urban LandEconomics Research Working Paper

Hanushek Eric A and John M Quigley 1982ldquoThe Determinants of Housing Demandrdquo in Re-search in Urban Economics 2 J V Henderson edGreenwich Conn JAI Press pp 221ndash42

Haurin Donald R Toby L Parcel and R JeanHaurin 2002 ldquoDoes Homeownership AffectChild Outcomesrdquo Real Estate Economics 304 pp635ndash 66

Hirad Abdighani and Peter Zorn 2002 ldquoPre-purchase Homeownership Counseling A LittleKnowledge is a Good Thingrdquo in Low IncomeHomeownership Washington DC Brookings In-stitute chapter 5

Jencks Christopher 1994 The Homeless Cam-bridge Mass Harvard University Press

Levine Ned 1999 ldquoThe Effect of LocalGrowth Controls on Regional Housing Produc-tion and Population Redistribution in Califor-niardquo Urban Studies 3612 pp 2047ndash 068

Levy Frank and Richard J Murnane 1992ldquoUS Earnings Levels and Earnings Inequality AReview of Recent Trends and Proposed Expla-nationsrdquo Journal of Economic Literature 303 pp1333ndash381

Maclennan Duncan John Muellbrauer andMark Stephens 1998 ldquoAsymmetries in Housingand Financial Market Institutions and EMUrdquoOxford Review of Economic Policy 143 pp 54ndash 80

Malpezzi Stephen 1996 ldquoHousing Prices Ex-ternalities and Regulation in US MetropolitanAreasrdquo Journal of Housing Research 72 pp 209ndash41

Malpezzi Stephen and Richard K Green1996 ldquoWhat Has Happened to the Bottom of theUS Housing Marketrdquo Urban Studies 3310 pp1807ndash 820

Malpezzi Stephen and Stephen Mayo 1987ldquoThe Demand for Housing in Developing Coun-tries Empirical Estimates from HouseholdDatardquo Economic Development and Cultural Change354 pp 687ndash721

Mayer Christopher J and C Tsuriel Somer-ville 2000 ldquoLand Use Regulation and New Con-structionrdquo Regional Science and Urban Economics306 pp 639 ndash62

Mayo Stephen 1981 ldquoTheory and Estimationin the Economics of Housing Demandrdquo Journalof Urban Economics 10 pp 95ndash116

Mayo Stephen and Stephen Sheppard 1996ldquoHousing Supply Under Rapid EconomicGrowth and Varying Regulatory Stringency AnInternational Comparisonrdquo Journal of HousingEconomics 53 pp 274ndash 89

Millennial Housing Commission 2002 Meet-ing Our Nationrsquos Housing Challenges Report of the


Bipartisan Millennial Housing Commission Wash-ington DC Government Printing Of ce

OrsquoFlaherty Brendan 1995 ldquoAn EconomicTheory of Homelessness and Housingrdquo Journalof Housing Economics 41 pp 13ndash49

OrsquoFlaherty Brendan 1996 Making Room TheEconomics of Homelessness Cambridge Mass Har-vard University Press

Orr James A and Richard W Peach 1999ldquoHousing Outcomes An Assessment of Long-Term Trendsrdquo Federal Reserve Bank of New YorkEconomic Policy Review September pp 51ndash 61

OrsquoSullivan Arthur 1996 Urban EconomicsThird Edition Chicago Ill Irwin McGraw-Hill

Pollakowski Henry O and Susan M Wachter1990 ldquoThe Effects of Land-Use Constraints onHousing Pricesrdquo Land Economics 663 pp 315ndash24

Quigley John M 1998 ldquoThe Taxation ofOwner-Occupied Housingrdquo in The Encyclopedia ofHousing W Van Vliet ed Thousand Oaks Cal-if Sage Publications pp 579ndash 81

Quigley John M 2000 ldquoA Decent HomeHousing Policy in Perspectiverdquo Brookings-Wharton Papers on Urban Affairs 11 pp 53ndash100

Quigley John M Steven Raphael and EugeneSmolensky 2001 ldquoHomeless in America Home-less in Californiardquo Review of Economics and Statis-tics 831 pp 37ndash51

Reed Deborah Melissa Glenn-Haber andLaura Mammeesh 1996 The Distribution of In-come in California San Francisco Calif PublicPolicy Institute of California

Reid Margaret 1962 Housing and Income Chi-cago Ill University of Chicago Press

Rosen Harvey S Kenneth T Rosen and

Douglas Holtz-Eakin 1984 ldquoHousing TenureUncertainty and Taxationrdquo Review of Economicsand Statistics 663 pp 405ndash16

Rossi Peter H 1989 Down and Out in AmericaThe Origins of Homelessness Chicago Ill Univer-sity of Chicago Press

Saiz Albert 2003 ldquoRoom in the Kitchen forthe Melting Pot Immigration and RentalPricesrdquo Review of Economics and Statistics August853 pp 502ndash21

Schill Michael H 2001 Regulatory Barriers toHousing Development in the United States Washing-ton DC Millennial Housing Commission Con-sultant Products

Susin Scott 2001 The Impact of the MarielBoatlift on the Miami Housing Market WashingtonDC US Census Bureau

Sweeney James 1974 ldquoA Commodity Hierar-chy Model of the Rental Housing Marketrdquo Jour-nal of Urban Economics 13 pp 288 ndash323

Thorson James A 1996 ldquoAn Examination ofthe Monopoly Zoning Hypothesisrdquo Land Eco-nomics February 72 pp 43ndash55

Thorson James A 1997 ldquoThe Effect of Zon-ing on Housing Constructionrdquo Journal of HousingEconomics 61 pp 81ndash91

US Department of Housing and Urban De-velopment 2000 Rental Housing AssistancemdashTheWorsening Crisis A Report to Congress on Worst CaseHousing Needs Washington DC GovernmentPrinting Of ce

Voith Richard 1999 ldquoDoes the Federal TaxTreatment of Housing Affect the Pattern of Met-ropolitan Developmentrdquo Business Review FederalReserve Bank of Philadelphia MarchApril pp3ndash16


about how much housing to consume relative to other goods This mixture of issuesraises dif culties in interpreting even basic facts about housing affordability Forexample the rapid rise in the price of homes clearly made homeownership moredif cult for many renters but it also greatly reduced the nancial costs of home-ownership to a much larger group of existing homeowners by providing substantialcapital gains Among renters the large share of income devoted to housing surelyre ects voluntary consumption choices for many households and the consumptionof a publicly determined minimum quality and quantity of housing for others Tothe extent that the latter group of households would choose a lower quality ofhousing given their opportunities one might conclude that the incomes of thepoorest households are insuf cient to afford the socially imposed minimum standard

This paper sorts out these issues We show that for the two-thirds of UShouseholds who own homes there is little evidence that housing has become lessaffordable in recent years For the one-third of US households who are rentersthe proportion of income that the median renter devotes to housing has increasedonly modestly However we nd pronounced increases in the typical rental bur-dens for poor and near-poor households Thus we examine the low-income rentalmarket in greater detail evaluating the contribution of changes in the incomedistribution increases in rental quality land-use regulation growth controls andzoning to the observed changes in rent burdens among low-income householdsWe end by sketching some policies that might improve the affordability of housingfor homeowners and for renters

Trends in the Rental and Owner-Occupied Housing Markets ThePast 40 Years

The majority of US households are homeowners and homeownership ratesin recent decades have trended upward for virtually all demographic groups By2000 two out of every three US households owned their dwellings Table 1presents homeownership rates for the period 1960 to 2000 for all households forquintiles de ned by household income and for poor households Over the pastfour decades aggregate homeownership rates increased by ve percentage pointsEven among households in the bottom quintile homeownership is quite commonIn 2000 45 percent of bottom-quintile households were homeowners as were37 percent of households with incomes below the poverty line

However income can be a misleading measure of housing affordability forexample many retirees have low annual incomes yet own their homes Thus Table2 presents more detailed tabulations of homeownership rates for the year 2000mdashfor households strati ed by income age of the household head and raceethnicityThese tabulations reveal several clear patterns First the high aggregate homeown-ership rates for poor and near-poor households evident in Table 1 re ect theconditions of older households with low incomes For many of these householdscurrent low incomes are likely re ective of retirement rather than material povertyFor the nonelderly poor and near poor homeownership rates are very low More-





1960 1970 1980 1990 2000






















R 5 iV



R 5 ~i 1 t 1 d 2 gV




019751970 1980 1985 1990 1995 2000

20

40

60

80

100

120

140

160

180

Inde

x Va

lue




R 5 ~i 1 a1 2 T 1 t1 2 T 1 d 2 g 1 aV


R 5 R 2 ~i 1 a 1 tTV











261980 1982 1984


1986 1988 1990 1992 1994 19961978

24

22

0

2

4

6

8

10

12

14

16

Use

r C

ost i

n P

erce

nt







1960 1970 1980 1990 2000















1960 1970 1980 1990 2000




Poor renters 13 (27) 12 (22) 12 (22) 9 (22) 4 (23)






































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10


20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars
























0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References
























































1960 1970 1980 1990 2000






















R 5 iV



R 5 ~i 1 t 1 d 2 gV




019751970 1980 1985 1990 1995 2000

20

40

60

80

100

120

140

160

180

Inde

x Va

lue




R 5 ~i 1 a1 2 T 1 t1 2 T 1 d 2 g 1 aV


R 5 R 2 ~i 1 a 1 tTV











261980 1982 1984


1986 1988 1990 1992 1994 19961978

24

22

0

2

4

6

8

10

12

14

16

Use

r C

ost i

n P

erce

nt







1960 1970 1980 1990 2000















1960 1970 1980 1990 2000




Poor renters 13 (27) 12 (22) 12 (22) 9 (22) 4 (23)






































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10


20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars
























0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References





























































R 5 iV



R 5 ~i 1 t 1 d 2 gV




019751970 1980 1985 1990 1995 2000

20

40

60

80

100

120

140

160

180

Inde

x Va

lue




R 5 ~i 1 a1 2 T 1 t1 2 T 1 d 2 g 1 aV


R 5 R 2 ~i 1 a 1 tTV











261980 1982 1984


1986 1988 1990 1992 1994 19961978

24

22

0

2

4

6

8

10

12

14

16

Use

r C

ost i

n P

erce

nt







1960 1970 1980 1990 2000















1960 1970 1980 1990 2000




Poor renters 13 (27) 12 (22) 12 (22) 9 (22) 4 (23)






































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10


20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars
























0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References






















































R 5 ~i 1 a1 2 T 1 t1 2 T 1 d 2 g 1 aV


R 5 R 2 ~i 1 a 1 tTV











261980 1982 1984


1986 1988 1990 1992 1994 19961978

24

22

0

2

4

6

8

10

12

14

16

Use

r C

ost i

n P

erce

nt







1960 1970 1980 1990 2000















1960 1970 1980 1990 2000




Poor renters 13 (27) 12 (22) 12 (22) 9 (22) 4 (23)






































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10


20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars
























0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References



























































261980 1982 1984


1986 1988 1990 1992 1994 19961978

24

22

0

2

4

6

8

10

12

14

16

Use

r C

ost i

n P

erce

nt







1960 1970 1980 1990 2000















1960 1970 1980 1990 2000




Poor renters 13 (27) 12 (22) 12 (22) 9 (22) 4 (23)






































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10


20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars
























0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References

























































1960 1970 1980 1990 2000















1960 1970 1980 1990 2000




Poor renters 13 (27) 12 (22) 12 (22) 9 (22) 4 (23)






































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10


20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars
























0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References

























































1960 1970 1980 1990 2000




Poor renters 13 (27) 12 (22) 12 (22) 9 (22) 4 (23)






































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10


20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars
























0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References
























































































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

10


20

25

30

35

5

40

Pri

ce in

Th

ousa

nds

of

Dol

lars
























0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References










































































0

1968

1970

1972

1974

1976

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

20

40

60

80

100

120

140

160

180

Dol

lars

in T

hou

san

ds


































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References



















































































Fiscalyear

Number ofrenter

households


inadequate housing


50 income

Number ofhouseholds

paying 50income


Totalsubsidized

renters

1973 24425 na 4828 13561974 24943 na 4922 15511975 25462 2832 4099 na 5450 17171976 25897 2886 4359 na 5311 20671977 26324 2840 4655 na 5311 20921978 26810 1677 4765 3661 5280 24001979 27174 2621 4790 4620 5461 26541980 27415 2589 4961 4935 6217 28951981 28709 2882 5399 5455 6851 30121983 29894 1617 5661 5481 7647 34431985 31736 1108 6739 6128 7223 38871987 33320 859 7675 6991 7005 41751989 33734 1587 6983 5187 6784 44021991 34242 1347 6938 5426 7712 46131993 35184 910 7163 5948 8393 48511995 35246 849 7385 6187 7532 50871997 35059 1072 7264 7359 7324 51201999 34831 1184 7476 6710 6676 51012001 34417 1178 7411 7092 6813 5061a







References

























































References





















































Is Housing Unaffordable? Why Isn't It More Affordable?housing is as affordable now, on average, as...

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Transcript of Is Housing Unaffordable? Why Isn't It More Affordable?housing is as affordable now, on average, as...