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Housing Affordability and Economic Security: What Else Matters? Prepared for the 11 th Annual Leckey Forum October 18

Housing Affordability and Economic Security: What Else Matters? Prepared for the 11 th Annual Leckey Forum October 18, 2013. AHS thanks the Housing Association of Nonprofit Developers for its support of this work. The research was conducted by Joanna Biernacka-Lievestro

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Housing Affordability and Economic Security: What Else Matters? Prepared for the 11 th Annual Leckey Forum October 18

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  1. Housing Affordability and Economic Security:What Else Matters?Prepared for the 11th Annual Leckey ForumOctober 18, 2013 AHS thanks the Housing Association of Nonprofit Developers for its support of this work. The research was conducted by Joanna Biernacka-Lievestro at the GMU Center for Regional Analysis.

  2. Context • Housing affordability is generally defined by comparing household income to housing costs— “30% rule.” • Other costs are rising and take up large shares of households’ incomes. • A complete picture of affordability considers all household expenses. • Efforts to look holistically include the Living Wage Project, Self-Sufficiency Standard, Economic Security Initiative. • How economically secure are Arlington households?

  3. Project • Analyzed monthly budgets for three family types using actual expenditure data. • Compared total monthly budgets with total incomes. • Assessed gaps between expenses and incomes. • Compared budget gaps for families living in market rate apartments versus committed affordable units (CAFs).

  4. Highlights • Families below median income struggle to support modest living standard in Arlington County. • One- or two-person households need to make 80% of AMI to break even. • Four-person households at 80% of AMI cannot meet expenses. • Rent is the largest expense, but child care is also a significant cost pressure. • Access to CAFs is important, predominantly for families. • Households are making sacrifices to live in Arlington for other benefits—most likely schools.

  5. Household Types and Data Sources • Household types • Data sources - Annual Affordable Housing Targets Report for FY 2012,Arlington Department of Community Planning, Housing and Development - Median Family Income Documentation System for FY 2011, U.S. Department of Housing and Urban Development - DC Metro Area Self-Sufficiency Calculator (BEST Index and Elder Index,) Wider Opportunities for Women • Consumer Expenditure Survey 2011, Bureau of Labor Statistics

  6. Monthly Budget Components

  7. Monthly Budget Components

  8. Monthly Budget Components

  9. Budget Components Excluded • Taxes • Public assistance (cash/in-kind) • Alimony/child support

  10. Arlington vs. Metro Area Average Rents Source: Arlington County DCPHD; HUD.

  11. Household IncomesArlington County Source: HUD, HHS.

  12. Monthly budget profile: 40%AMIMarket rent values, Arlington County

  13. Monthly balance: 40% AMICAF rent values, Arlington County

  14. Monthly balance: 40% AMIMarket v. CAF, Arlington County

  15. Monthly budget profile: 60% AMIMarket rent values, Arlington County

  16. Monthly balance: 60% AMICAF rent values, Arlington County

  17. Monthly balance: 60% AMIMarket v. CAF, Arlington County

  18. Monthly budget profile: 80%AMI Market rent values, Arlington County

  19. Monthly balance: 80% AMICAF rent values, Arlington County

  20. Monthly balance: 80% AMIMarket v. CAF, Arlington County

  21. Budget Profile Comparison Arlington County and U.S. • Rent is the major cost pressure in the basic budget of singles and families nationwide. • Rent in Arlington County is much higher than the national average. • One-person household’s rent in Arlington is nearly twice as high as the national average; • Four-person household’s rent in Arlington is over twice as high as the national average. • Child care is the second highest financial burden for families nationally, but it is exceptionally high in Arlington. • Child care cost for a four-person household in Arlington is over twice as high as the national average.

  22. Budget Profile ComparisonArlington County and U.S.

  23. Budget Profile ComparisonArlington County and U.S.

  24. Conclusion • Rent is a major—though not the only—cost pressure. It is the one where the County can make the most difference. • Better data are needed about the number and composition of households below 40% of AMI, and especially larger families. • It is important to understand how household get by when expenses exceed incomes. • Continous research is necessary to investigate and asses options for assisting families below under median income in securing a modest standard of living in Arlington County.

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