Report: More Households Spending More Than Half of Monthly Income on Housing

Published on June 16, 2010

Despite falling home prices, loan modifications, and softening rent due to the economic downturn, the number of households spending half or more of their income on housing has climbed to a new high. This analysis is part of the just-released State of the Nation's Housing report from the Joint Center for Housing Studies at Harvard University.

According to the report, after holding steady at 12 percent in both 1980 and 2000, the share of severely burdened househlds (spending more than half their incomes on housing) jumped by a third, to 16 percent, in 2008. A record 18.6 million households faced these high cost burdens that year — up from 13.8 million in 2001.

Consequently, in 2008 low-income households with children that dedicated more than half of their expenses on housing had less than $600 per month left for all other necessities including food, health care, and childcare — less than half the amount available to households living in affordable housing. Similarly burdened elderly and single-person households had even less (under $500) left over after housing expenses.

The report also examined housing opportunities that lie ahead. Speaking of the prospect for energy savings as the nation strives to reduce carbon emissions, Mohsen Mostafavi, Dean of the Harvard University Graduate School of Design, said "not only can new green building standards and innovative architectural designs help reduce energy consumption in the next generation of homes, there are opportunities to wring major savings out of the existing housing stock."

Read the full report.