Affordable Housing: A Home For Everyone

Family Promise Executive Director, Joe Nettesheim, recently participated in the Home for Everyone Conference, hosted by the Wisconsin Collaborative for Affordable Housing.

The primary reason homelessness exists is a lack of affordable housing. This is not news to anyone who has been reading our Friday Five newsletter. Do not misunderstand. Homelessness is a complicated issue that has many contributing external and internal factors such as mental health issues, addiction, and our eviction policies, but even if these issues did not exist, there simply are not enough housing units available to those who need them.

We have often cited statistics from the National Low Income Housing Initiative gap report, which has stated that there is not one community in the United States that has adequate affordable housing. According to this report, there are just 37 affordable housing units available for every 100 households who need affordable housing. In the Milwaukee-West Allis-Waukesha area, there are just 27 units available for every 100 households that need affordable housing. At the Home for Everyone Conference, this lack of affordable housing was made even clearer. If we do not address the need for affordable housing soon, today’s children will be part of a new generation of chronic homelessness.

Tieg Whaley-Smith from Partnerships in Housing is part of a group that has developed a comprehensive housing plan for the city of Milwaukee. As he shared information about their plan, he also shared sobering information about the lack of affordable housing. First, what determines if housing unit is sustainable for a household, it should not cost more than 30% of an individual's income. This would mean that an individual who worked a full time job at $12/ hour can afford an apartment at approximately $650/month. Those homes simply do not exist. A recent article in the Washington Post stated that the average rent for a two bedroom apartment in Waukesha County is $1385. That is more than double the rent a worker who makes $12 an hour can afford.

In the state of Wisconsin, there are over 250,000 families who make less than $15 an hour, but there are fewer than 160,000 homes available to them.

Many of the families who apply for the Family Promise Family Homelessness Prevention Program often pay close to 50% of their income toward housing costs. It is simply not sustainable. Most arrived in this situation because they had little option to apply for housing they cannot afford, which inevitably puts financial stress on the household and often leads to an eviction. The slide below from Tieg's presentation shows that rental units exceed demand around $25,000 a year salary. The supply of housing available for any household making less than $25,000 a year is not enough. Based on income reported by our prevention experience and the income reported by applicants 84% of applicants make less than $2000 a month. One realization we have is as much as we try to support families who need a one time payment for too many one time is not getting them our of their situation. It is important to note that some might ask, well why don't those in need just get a higher paying job? Salaries have increased however they have not kept pace with the dramatic increase in rent.

The solutions are challenging. One promising program is Section 8 Housing Vouchers. In this program the recipient of the voucher will never have to pay more than 30% of their income on rent. The state pays the remainder to the landlord. It essentially creates additional affordable housing units. The program, however, is underfunded and it can take years for clients to receive this assistance. It is not unusual for an applicant to wait up to six years before they receive their voucher. Then once they receive the voucher, many landlords are not interested in working with those tenants. The reasons are not always clear but anecdotally it seems that some landlords worry about the financial stability of tenants who need a voucher even though it does guarantee them a percentage of the rent even if the tenant does not follow through.

Building additional apartment units could also be a solution, but this solution also has drawbacks. Many residents are leery of “affordable housing” in their neighborhoods. They have concerns that it will lower their property value. Or they have a Not-in-My-Backyard attitude based on a stigma that accompanies poverty: that low income residents are undesirable individuals. None of this is true actually as studies demonstrate that mixed valued housing neighborhoods actually retain their value. Another roadblock includes current expenses associated with building. It is incredibly difficult to build (or to purchase) a multifamily apartment complex and recoup the investment by charging only $650 a month in rent.

The most effective solution will be one that is collaborative and involves everyone. It will take residents being open to affordable housing in their neighborhoods, and elected officials recognizing that government funding will need to support these efforts. It will mean developers, landlords and nonprofit agencies working together to provide affordable housing options and wraparound services. It will include seminars on growing tenant skills and giving them the support they need to establish a sound financial foundation.

None of this will happen until we all recognize that the cost of allowing homelessness to exist in the community is far greater than making investments in families and our future. It is a prudent investment to make sure that we have homes for working class families. It is a prudent investment to make sure families are not sleeping in a tent, a car or the floor of a relatives home. It is a prudent investment to ensure that children grow up in stable homes. It is prudent to have a community response to families experiencing or at risk of experiencing homelessness.