February 4, 2011

Recession pushes low-income families to the brink

Written by:

This post is also available in: Spanish

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.

9 Responses to Recession pushes low-income families to the brink

  1. I JUST FINISHED A COMMENT PAGE ONE BUTTON ITS GONE. I WAS DELT A POOR HAND. THATS LIFE!!POOR ARE POOR ALL N ALL WHERE POOR. HELP.WISH I HAD 100,000 or more BUT IM POOR BLACK WHITE SPANISH MEXICAN ALL THE SAME POOR IS POOR. AND I CANT READ THE CODE AT THE BOTTOM. THERE WAS A CHURCH IN KENTUCKY AND IT WAS FULL THEY PASSED THE OFFERING AROUND AND ENDED UP WITH .70 SOME CENTS POOR IS POOR. THAT WHY WE ASK FOR HELP. MY DAD SERVED IN NOM HAD COLLEN CANCER AND DONT GET FULL VA BENIFITS. MY BROTHER GOING BACK OVER IN IRAQ FOR 3 YEARS. I WAS TOLD TO STAY OUT NOW LOOK IM ALL MESSED UP. WHERE STILL AMERICANS BUT POOR NO ONE GIVES US A HOOT OR A LOAN IF SO I WOULD BE ABLE TO GET A LOAN. IM JUST WANT TO LIVE WHAT DAYS I HAVE LEFT. THANK YOU JOHN

  2. Dear Sir’s, we’er white, and have to go to charities for food, rent electric help. My husband is disabled he’s 64 I’m 67 we’d like help from hud to pay just half of lot rent for mobile home. our combined income $ 1,010.00 monthly lot rent $520.00 monthly leaving us very little for other expences like getting tags for car. please let us know if you will help.

    Thank you for your time,

    Sincerely,

    Rose

  3. Those numbers are depressing and I can only imagine what those numbers became in 2010. I’m hoping the promise of new jobs and helpful programs like HUD’s will help us move forward.

  4. Por fabor nesesito ayuda estoy resibiendo de Desenpleo 153 dolares semanal tengo 2 nenas eso no me es sufisiente para mantenernos ahorita estoy perdiendo la vivienda no califico para una modificacion tengo bajo ingreso y cuando me lo dejen de dar ya no tendre ninguno ya me duele los dedos de hacer aplicaciones y nada talbes si ustedes tienen otro estado q puedan indicarme q halla trabajo pues yo pudiera trasladarme para otro estado por fabor nesesito ayuda

  5. The suffering is everywhere and affects just about everyone. I am one of those. I won’t bore you with the details but I will say this.
    It concerns me that the Feds are more than willing to help but, the bureaucracy at the state and local level muddies up what is available and to what level it is available. For example, I qualify for the Emergency Home Owner Loan Program which is for Un-employed or under-employed people with home mortgages. It is The Dodd-Frank Wall Street Reform and Consumer Protection Act that has provided $1billion to HUD to implement the Emergency Homeowners Loan Program (EHLP) Program. When I followed procedure at the local level and approach HUD approved Neighborhood America organizations the local “counselors” want to show me how going from $150,000 annual income, to $1600 a month of un-employment, how to pay not only my mortgage, but utilities, car payments, blah blah blah, and the truth of the matter is, the un-employment is not going to cover the house note much less anything else. Even Ray Charles could see that. I go out and start mowing yards as a last ditch effort to supplement the un-employment shortfall of $10,000 per month, and instead of being able to add to the monthly un-employment amount, I am penalized for MOWING YARDS and now am considered a contractor and since un-employment is based roughly on the last two employers, my unemployment is based on the last two yards I mowed at $20 a piece.
    Pardon the tangent, when in front of the HUD approved counselors and I bring the Emergency Loan Program to them printed right from the US dot gov site, I have how I am qualified, my business plan, (I open my own start-up company as I cant wait to find a job, so I will make one myself), as the program allows for a 24 month payback schedule.
    These people have no idea what the plan is, even after getting the office manager and anyone else in the building that will listen, they dont have a clue how to implement, who to go to, to start the process. The loan program allows for autonomy at the state level if the state has a “similar” program in place. Neighborhood America looked at me like I was an alien and I ended up walking out of there in more trouble than when I arrived.
    Where do we go to facilitate the bridge between the Feds and the State and Local facilitators.
    Dont get me wrong, I am as grateful as I know how to be that the Feds are willing to help and have moved forward with legislation to do so. I am just frustrated about the mess in the middle.
    The top wants to help, the bottom sees that, recognizes an opportunity, and it’s as if we are on opposite sides of the Grand Canyon. We can see each other, but we cant get there from here.
    HUD, thank-you for doing what your doing during this bump in the road called the melt-down. I know for one this is NOT the destination for most of us, it is only part of the journey. I also firmly believe that “continuous sunshine, makes for a desert, EVERY living thing needs a little *weather* to grow”. It’s nothing short of just living life on life’s terms. I have rolled up my sleeves and digging a ditch with a spoon. Unfortunately, I am running out of time.

  6. Why can’t HUD help people that do pay their rent on time put may have a low credit score because of the economy and now miss out on a Fannie Mae loan because of they don’t have a 640 credit score is crazy their rent is $850.00 and the loan would $450.00 why is the credit score so high? This is not helping any one and only hurting the one’s that need it the most. The people bailed the banks out now it is time the banks help the low income people out buy lowering the or do away with the credit scores for now. I have always though the gov. bail out should have been give the home owners the money to pay the houses off and then the banks could what ever they wanted instead of them keeping the money to waste on parties and such and to buy other banks out. Banks turn to give back to the people who helped them in their time of need.

  7. Mr. Donavan

    I’m trying to contact R Lopez field director for TX email 2104726804
    but am having trouble in reference to a very wrongful eviction of a young lady who is pregnant and has a 4 month old plus 4 other schoolage
    children all due to retaliatory actions of a current director of Willacy County Housing Authority named J.Torres. She has nowhere to go
    and his attitude is \ask me if I care\. He has given her Feb. 18th eviction date and has threatened that he will see to it that she not be able to get housing help. This young lady lives on SSI benefits and
    has no job. Please I am asking you to intervene. He told her he would no longer give her the vouchers she applied for and was elgible for. I was under the belief that the HUD gov. gave them to her and not this man. If he takes where do this funds go? Her sole income is only 696.00
    Please have this checked into before she and her 5 and 1/2 children become homeless.

  8. you know they have to get back to affordable safe housing the rents that these landlords are charging is out of controll,and then on top of that, they want a credit check and all of this crazy stuff we need help and change.

Leave a Reply

Your email address will not be published. Required fields are marked *