Harvard’s national housing report has bad news familiar to Boston buyers and renters
In its annual State of the Nation’s Housing report, the Joint Center for Housing Studies of Harvard University begins by noting the improvements that have been made since the recession. Home prices are almost back to what they were, and the number of homeowners underwater on their mortgages has decreased, as have delinquency rates.
But other areas of the housing market have not fared so well. One such issue probably resonates with Boston-area renters and homeowners: lack of affordable housing.
The homeownership rate in the country is at its lowest point in half of a century, falling to only 63.7 percent in 2015, largely because it’s so hard to find affordable homes.
“Tight mortgage credit, the decade-long falloff in incomes that is only now ending, and a limited supply of homes for sale are all keeping households—especially first-time buyers—on the sidelines. And even though a rebound in home prices has helped to reduce the number of underwater owners, the large backlog of foreclosures is still a serious drag on homeownership,” Chris Herbert, managing director of Harvard’s Joint Center for Housing Studies, said in a statement.
The report notes there are factors at play, though, such as people marrying older and putting off homeownership.
Given the higher number of renters, “rental demand has risen across all age groups, income levels, and household types, with large increases among older renters and families with children,” the report states.
Increasing rent prices and low vacancy rates have both contributed to the historically high number of cost-burdened renters in the United States. The report mentions that the number of cost-burdened owners (people paying more than 30 percent of their income for housing) has fallen, while the number of cost-burdened renters has increased.
According to the report:
“On the renter side, the number of cost-burdened households rose by 3.6 million from 2008 to 2014, to 21.3 million. Even more troubling, the number with severe burdens (paying more than 50 percent of income for housing) jumped by 2.1 million to a record 11.4 million.”
Looking toward the future, the Joint Center for Housing Studies urges the creation of more affordable rental housing and the continual increase of more housing construction.
Read the full report here.
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