How Affordable is HUD Affordable Housing?: Final Report

Abstract

Type of Report and Period CoveredFINAL REPORT 14. Sponsoring Agency Code Supplementary Notes AbstractThis paper assesses the affordability of HUD rental assistance properties from the standpoint of transportation costs. HUD housing is, by definition, affordable from the standpoint of housing costs due to limits on the amounts renters are required to pay. However, there are no such limitations on transportation costs, and common sense suggests that renters in remote locations may be forced to pay more than 15 percent of income, a nominal affordability standard, for transportation costs. Using household travel models estimated with data from 15 diverse regions around the U.S., we estimated and summed automobile capital costs, automobile operating costs, and transit fare costs for households at more than 18,000 HUD rental assistance properties. The mean percentage of income expended on transportation is 15 percent for households at the high end of the eligible income scale. However, in highly sprawling metropolitan areas, and in suburban areas of more compact metropolitan areas, much higher percentages of households exceed the 15 percent threshold. This suggests that locational characteristics of properties should be considered by HUD when establishing eligibility for rental assistance subsidies.17.

The Link Between Transit Station Proximity and Real Estate Rents, Jobs, People and Housing with Transit and Land Use Planning Implications

“…In recent years a growing body of literature has argued that housing and transportation costs need to be considered together when considering housing affordability.15 Ewing and Hamidi (2015) note that HUD's definition of affordability-where no more than 30 percent of a household's income would be spent on housing-along with indexes of others are "structurally flawed in that they only consider costs directly related to housing, ignoring those related to utilities and transportation" (Ewing and Hamidi: 5). The 2013 Consumer Expenditure Survey, for instance, reports that total housing costs consume 33.6 percent of income16 while transportation costs consume another 17.6 percent for a total H+T of 51.2 percent.…”