Freddie Mac: Cities Rapidly Losing Affordable Housing
The multifamily financing arm of the government-sponsored enterprise reported a substantial decline in affordable housing units over a seven-year period.
The fastest growing cities in the U.S. are rapidly becoming the least affordable. In a new study released by Freddie Mac Multifamily, the government-sponsored enterprise found that in a span of seven years, the cities with the most population growth in the U.S. had a steep decline in the number of low-income housing units.
The top 10 fastest growing cities out of the top 50 metros in the nation, where the average population growth was more than 15 percent, lost more than a third of very low-income affordable units between 2010 and 2017, according to the report. The average loss of those kinds of units was about half that amount in metros where population growth averaged around 5 percent. Researchers examined multifamily rental affordability using area median income data, known as AMI, from the Federal Housing Finance Agency, as well as unit-level rent data from the American Community Survey.
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The report, “Diminishing Affordability—Inescapable,” shines a light on the affordable housing crisis that has been developing across the country in recent years. The key finding was that population growth is strongly correlated with affordability loss, leading to cities struggling to build enough housing to keep up with the booming growth.
Researchers focused on a few cities where the crisis was the most striking, including Austin, Texas. In the state’s capital city, the population grew by a staggering 22.5 percent over the seven-year span that was studied, the fastest in the nation. The sharp increase in population cut the stock of affordable multifamily units to low-income households by more than half, according to the report.