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Why Is "Affordable Housing" So Expensive?

According to the U.S. Department of Housing and Urban Development (HUD), Americans should ideally pay no more than 30 percent of their income on rent or mortgage. That's what HUD has established as affordable. But as rents go higher and higher, renting becomes more and more UNaffordable.

About 65 percent of Americans are homeowners. The other 35 percent are renters. According to a report by Harvard’s Joint Center for Housing Studies, now more than 50 percent of U.S. households pay over 30 percent of their income towards rent. In 2000, only 38 percent of U.S. households paid over 30 percent of their income for rent.


While more than half are paying over 30 percent for rent, others are simply being displaced. The word gentrification can be found more and more in articles written about today's housing dilemma. Gentrification refers to the displacement of low-income workers by converting aging neighborhoods into more affluent ones. That is exactly what is happening. But there is much debate on whether or not gentrification is good for everyone.

Pros and cons

The pros include better quality of housing, decrease in crime, and increase in income. One of the biggest drawbacks, however, is the displacement of low-income residents who just cannot afford the higher rent that comes when rental property is refurbished. A 2006 Harvard study estimated that about 10,000 households in New York City are displaced by gentrification each year. These displaced people often have no where else to go but shelters or moving in with family. Many end up homeless.

It seems that low-income housing has taken a very different direction. What do you think?

To read more about America's Rental Housing study by Harvard, visit:

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