Testifying before the Senate Banking, Housing, and Urban Affairs Committee on Feb. 9, in its first hearing of the new Congress on The State of Housing 2023, Dr. Christopher Herbert, the Joint Center for Housing Studies of Harvard University’s (JCHS) managing director, joined other housing industry experts to describe the state of the nation’s housing.
Herbert provided an overview of the market conditions the Senate should consider as it sets its agenda during the next two years, with affordability being the nation’s most pressing issue:
Arguably, the nation’s principal housing challenge is that of affordability. The share of renters facing housing cost burdens rose from the 2000s through the middle of last decade. While the years before the pandemic saw a modest recovery, the cost-burdened share of renters has now worsened substantially in the face of rising rents. While young adults and people of color were able to make up some lost ground in homeowning, following the Great Recession, the combination of very high home prices and now much higher interest rates has priced most would-be owners out of the market. Today’s worsening homebuyer affordability is particularly concerning given stubbornly high disparities in homeownership rates for Black and Hispanic households.
One notable feature of the trends in housing affordability over the last two decades has been the spread of these problems to those higher up the income ladder. The recent jump in renter cost burdens has in fact been most pronounced among middle-income renters.
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