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Growing number of Hispanics and African-Americans especially hard hit
Our guest blogger today is Dr. Raphael Bostic, HUD Assistant Secretary for Policy Development and Research
In this country, there are millions of very low-income families who don’t receive any government housing assistance and either pay half their monthly income on rent, live in deplorable conditions, or both. This week, we released a new study Worst Case Housing Needs 2009: A Report to Congress. In 2009, there were 7.1 million households that fell into this category. These ‘worst-case’ families are teetering on the edge of homelessness and our report finds that Hispanics and African-Americans were especially hard hit.
The number of these renter households represents a significant increase compared to the number of these families we reported for 2007. Between 2007 and 2009, the number of these households grew by nearly 1.2 million, or by more than 20 percent – the largest two-year increase since HUD began reporting this segment of the rental market in 1985. On average, these families experienced a 10 percent rent hike over this two-year period.
This is a national phenomenon confronting households of every type and in every region. Every racial and ethnic group, regardless of whether they lived in cities, suburbs or rural areas, felt the impact, as did everyone from senior citizens to disabled residents.
However, a whopping 45 percent of all very low-income Hispanic renters experienced this hardship, an eight percent jump from 2007. This represents the largest increase among all racial or ethnic groups.
What’s behind these stark figures, and what will work for all groups? It’s no mystery that the Great Recession [a general decline in the job market] is the chief reason we’re seeing more of these struggling households. Unemployment and under-employment in all groups pushed 410,000 more households into this worst case needs category, accounting for more than one-third of all new cases. Moreover, the foreclosure crisis pushed many families in all categories headlong into the rental market, increasing competition for rental units and placing upward pressure on rents.
HUD Secretary Shaun Donovan said that a growing economy and new jobs, combined with HUD’s new commitments to produce and preserve affordable rental housing, is what we need to reverse these difficult housing trends for all American families.
We have started seeing positive signs on the economy front, with more than a million jobs created in the past year. We hope this trend continues and accelerates, so that we can soon paint a more positive picture about the housing market for all.
Meanwhile, HUD will continue to focus on offering housing assistance to families through programs such as the Recovery Act’s Tax Credit Assistance Program ($2.25 billion) and Public Housing Capital Fund ($3 billion), plus others, which have together prevented or ended homelessness for more than 750,000 persons. Other government housing assistance programs, including those provided by HUD, significantly reduce worst case housing needs and homelessness but are not available for all those who need assistance. Nationwide, 25 percent of the very poor receive some form of rental assistance.