August 28, 2014
Location Affordability in NYC
Following up on two earlier posts (here and here) about Citizens Budget Commission policy briefs on housing affordability, I turn to a third one, Location Affordability in Large U.S. Cities. As a refresher, “Location affordability recognizes that the costs of housing and transportation, usually the two largest items in household budgets, are inextricably linked, and considering them together in relation to income gives a good sense of a city’s location affordability.” (1) the CBC’s key findings are that,
- For moderate- and middle-income households, location costs in New York City are below the 45 percent affordability threshold due mostly to low commuting costs. New York City ranks well—ranging from second to sixth most affordable—among the 22 large cities.
- For low-income households, location costs in New York City exceed the affordability threshold. A low-income family requires 47 percent of income for these costs and a single worker household requires 56 percent; for a single person earning a wage at the national poverty line, location costs in New York City are particularly burdensome at 101 percent of income. Almost all cities examined were unaffordable to low-income households. (1, citation omitted)
There are a lot of interesting implications that arise from these policy briefs. Most important, they provide another (if it were even necessary) argument that scarce affordable housing dollars should be concentrated on low-income households. After all, NYC moderate- and middle-income households are doing better than in most other large American cities when transportation expenses are taken into account in an affordability index.
It would be most worthwhile for the de Blasio Administration to incorporate something like HUD’s Location Affordability Index into its housing plan.
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