Declining housing affordability has received a lot of attention over the past few years, and deservedly so. We’ve seen rising home prices across the country continue to chip away at Americans’ ability to buy their own homes. Declining housing affordability has taken center stage in the national debate over whether it’s a wise move to unwind Fannie Mae and Freddie Mac, the government-sponsored enterprises that back 90 percent of U.S. mortgages.
But while this challenge is well understood, declining rental affordability hasn’t been as much of a hot-button issue. By 2020, more than one million apartment projects backed by low-income housing tax credits (LIHTCs) will come to the end of their compliance periods, making them eligible for a return to market-rate rents. This “LIHTC Ledge” threatens to exacerbate what is already a tenuous situation for the growing tide of renters who can’t find affordable accommodations.
Make no mistake about it: America is becoming a nation of renters. Since the depths of the recession, millions of Americans have lost their homes to foreclosure, and positive public sentiment toward home ownership is decidedly weakening: More than half of the 1,433 adults surveyed on behalf of the MacArthur Foundation last year believe that buying has become less appealing, while an almost equal share said that renting has become more attractive.
The housing sector is beginning to take its cue from such sentiments. In 2013, one in three of the nearly 1 million new residential housing units was a rental in a multifamily building, the highest share since the U.S. Census began tracking such data in the mid-1970s. Continue Reading on The Hill