There’s good news for homebuyers in the D.C. area this fall: The Washington Post reports that analysts expect healthier inventories, stabilizing prices, and fewer bidding wars. To help boost the housing market, Councilmember Grosso introduced a “tax credit” bill last month to cut district taxes for first-time homebuyers.
We have to admit—this sounds great to us. You see, we’re both in DINK households—Dual Income, No Kids. Yuppies in comfortable, do-gooder D.C. jobs. One of us just bought a home, the other is considering it. It’s hard not to read this news and think: Ooh, is the credit retroactive? How can I get a piece of this pie?
But a growing number of D.C. families have a different question about housing: Where are we going to sleep tonight? And our housing policy isn’t helping to provide much of an answer.
Since 2008, the District’s homeless population has increased 73%. Nearly half are people living with families. Though six of America’s ten wealthiest counties are in the D.C. region, one-third of all four member households earn less than $70,000 a year.
At the same time, D.C. housing prices remain sky high. The median price for a D.C. home is half a million dollars. And though the city’s stock of luxury apartments has increased more than 70% since 2010, vacancy rates for older, more affordable apartments remain extremely low.
This combination — of stagnant incomes and high housing prices — means there’s no reason to expect the rise in D.C. homelessness to end anytime soon.
The Great Recession is of course a key driver of these trends. The bad economy and lingering unemployment rates continue to hurt millions of families across the country. But macroeconomic forces aren’t the only thing prolonging the District’s current homelessness crisis. The split between housing policy for the wealthy and housing policy for most families is making things worse.
What about that legislation offered by Councilmember Grosso? The first-time homebuyer taxes that the legislation would cut help fund the Housing Production Trust Fund—the main source of funding for affordable housing in the District. So it’s a boost for wealthy homebuyers who are doing just fine, and a cut for low- and moderate-income D.C. residents who are struggling.
Unfortunately, boosting homeownership tax programs for top earners while short-changing housing programs for everyone else is a common practice for policymakers. And no U.S. legislative body does it with such aplomb as the U.S. Congress.
One of the few resources to assist low-income households with unaffordable rents is the federal Housing Choice Voucher Program, or Section 8. For four decades, this program has used private-sector solutions to make housing available to those in need.
This year, Congress scaled back rental assistance significantly, even though the housing market has become increasingly unaffordable for many Americans, particularly those with lower incomes. These cuts will result in 80,000 fewer households receiving help, deepening the 72,000 reduction caused by last year’s sequestration.
We know, we know. In this town of policy wonks and political spinners, these are just another set of numbers. It’s easy to gloss over them. But take a moment to imagine the human faces behind these numbers. Tens of thousands of fewer American households are receiving the help they need to sleep comfortably tonight. Fewer vouchers mean less stability for the elderly who scrape by on fixed income; for the adults who want to work; for the children who want to excel at school. It means scores more homeless on the street and in shelters. These are the human consequences of these numbers.
Some argue that the federal government can’t afford to spend any more to ensure that homeless families have a safe place to sleep. This is just ridiculous. Taxpayers are spending more to house the wealthiest among us than they are to house low-income families.
Wait a minute, can that be true?
In 2012, the Heritage Foundation put together a list of twelve low-income housing programs to highlight the size of government “welfare” spending. Those programs cost about $50 billion last year. This may seem like a large sum, but consider that the federal government also spent $211 billion last year on homeownership tax programs. In fact, the top 10% of earners received about as much housing support from just two of these tax programs – the Mortgage Interest and Real Estate Tax Deductions – as the federal government spent on all of the housing “welfare programs” identified by Heritage. Simply put, the government spends some to help house low-income families, but it spends a lot more to help house high-income families.
There is one more key difference between high-income homeownership tax programs and low-income rental vouchers: the former are scheduled to grow 80% between 2011 and 2019. At the current rate, we’ll be spending $240 billion predominantly to help house the wealthy, while cutting thousands of vouchers for those who desperately need a safe place for their families. If this seems inefficient, inequitable, and callous, that’s because it is.
Congress has the power to change this. The lack of affordable housing is a crisis that our nation must address. In the District, we have families living in hotels, doubled-up with relatives or friends in overcrowded households, and even sleeping in cars. The same is true in communities across the country. We cannot allow this to continue.
We need policymakers to stop indulging the excesses of the wealthy at the expense of struggling families and individuals. We need policymakers to match the scale of the problem with real solutions to end homelessness in America.