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A New Housing Policy: Imagine the Possibilities

A New Housing Policy: Imagine the Possibilities. Rental Housing Not Housing of Last Resort. 24 million households—more than 20 percent —call an apartment their home. Their numbers are growing.

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A New Housing Policy: Imagine the Possibilities

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  1. A New Housing Policy:Imagine the Possibilities

  2. Rental HousingNot Housing of Last Resort • 24 million households—more than 20 percent—call an apartment their home. • Their numbers are growing. • In 2006, Harvard’s Joint Center for Housing Studies predicted an increase of 1.8 million renters by 2015. Instead, we saw a surge of 1.5 million renters from 2005 to 2007 alone.

  3. The Homeownership Bias • In 2006, the federal government spent approximately $216 billion on housing programs and tax expenditures. • 73 percent went to homeownership; just 27 percent went toward rental housing. • We spend more on the deductions for mortgage interest and property tax than the combined federal spending on education, roads, mass transit and national parks.

  4. Housing Policy Disconnect • America WANTS rental housing. • America NEEDS rental housing. • Renters are not Second-Class Citizens • Tremendous opportunity to undo mistakes of the past.

  5. Growth = Choices and Opportunity • The U.S. population is expected to increase 33% by 2030 to 376 million. • That’s 94 million more people than there were in 2000. • To accommodate that growth, we need 60 million new housing units.

  6. America Wants Rental Housing

  7. Future Housing Demand • 78 million Echo Boomers getting ready to enter the housing market, almost universally as renters. • By 2015, there will be 67 million people aged 20-34, in other words, people in their prime renter years. • 10 million immigrants who will come to this country in the next 10 years.

  8. Build for New Choices For 50 years, families with children drove America’s housing industry. But married couples with children are projected to decline to just 1 in 4 households by 2025. By 2020, singles and unrelated individuals living together will comprise one out of every three households.

  9. Profound Housing Policy Disconnect • Half of all new homes built between now and 2020 will have to be rental units. • The U.S. will have a likely surplus of 22 million large-lot homes—that’s houses built on a sixth of an acre or more—by 2025. • That's roughly 40 percent of the large-lot houses in existence today. Our housing policy has to be amended to reflect our changing preferences.

  10. America Needs Rental Housing

  11. Environmental Factors • If we can shift 60 percent of new growth to compact, walkable neighborhoods—the kinds where apartments are found—we would save 85 million metric tons of carbon dioxide annually by 2030. • Compact Development: • Preserves green space • Reduces damage to streams, lakes and rivers by reducing the amount of paved surfaces • Reduces air pollution by reducing the need to drive

  12. Infrastructure • Sprawl is expensive!

  13. Make the Most of What We Have • Compact development reduces infrastructure costs and saves money. • Nationally, the U.S. can save over $100 billion in infrastructure costs over 25 years by growing compactly. • Chicago can save$3.7 billion over 20 years by growing compactly.

  14. The Affordable Housing Shortage • 35 million households spend 30 percent or more of their annual income on housing. • 114 million people live in households that did not earn enough ($37,105) to reasonably afford a two-bedroom apartment.

  15. New Housing Policy Paradigm

  16. Change the Dialogue Renters are Not Second-Class Citizens • End the myths that apartments cause crime rates to spike and property values to plummet. • Owners benefit from having rental housing in their communities.

  17. Change the Dialogue Housing is Shelter, Not an Investment • It costs $311 less a month, on average, to rent than to own. • A $100 investment in housing in 1985 would be worth $270 today, while that same $100 placed in stocks would be worth $722—nearly two-and-a-half times as much.

  18. Change our Policy Paradigm No New Homeownership Incentives • Current incentives overwhelmingly benefit the wealthy and distort the economy by encouraging people to overinvest in housing. • Large numbers of renters will not undo our society. • Switzerland has a homeownership rate of 35 percent. • Germany has a homeownership rate of 42 percent.

  19. Change the Regulatory Climate • Zoning and land-use regulations that favor sprawling, car-dependent development. • Federal, state and local policies should encourage the development of compact, sustainable housing located near transportation and employment centers.

  20. Change the Economic Climate • Bridge the gap between construction costs and affordable rents. www.nmhc.org/goto/workforcehousing

  21. Federal Incentives • Fully fund and reform the Section 8 program. • Fix the Low-Income Housing Tax Credit program. • Enact Exit Tax Relief

  22. Imagine the Possibilities

  23. Thank You Douglas M. Bibby President National Multi Housing Council Web Site: www.nmhc.org E-Mail: info@nmhc.org Phone: 202/974-2300

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