Household income fails to keep pace with housing and transportation expenses
The combined cost of housing and transportation continue to outpace income growth in the nation’s largest 25 metropolitan areas, according to a report released today by the Center for Housing Policy and the Center for Neighborhood Technology. The authors of the report found that looking at the combined cost of these two indicators is particularly important because transportation-related costs shape the overall affordability of a community, and in turn, affect the ability of families to make ends meet.
From 2000 to 2010, the researchers found that the expenses for housing and transportation rose by $1.75 for each dollar gained in household income, meaning many families are worse off now than at the beginning of the decade. Overall, housing and transportation costs consume nearly half of all household income, forcing many low- and moderate-income families to make tradeoffs between these expense and other expenses like food, child care, and health care. The following policies were among some of the policy tools available that are highlighted in the report:
- Preservation of existing affordable homes near job centers, public transit stations, and other places where transportation costs are low (“location-efficient areas”);
- Incentives or requirements to include affordable housing within new development in location-efficient areas;
- Mechanisms for ensuring long-term affordability; and
- Policies that capture a portion of the value generated by public investments in location-efficiency to support affordable homes in these areas.
Although the report does not include data for any of the metropolitan areas in North Carolina, Census data show that nearly 1 in 2 North Carolinians pay more than 30 percent of their income in housing—meaning their housing is not affordable. Census data also show that more North Carolinians are relying on public transit to connect to job networks amidst year-after-year declines in median household incomes.
As these trends continue, the growing spatial mismatch between affordable housing, jobs, and public transit deserves greater attention. It is important for local and state policymakers to understand the burdensome expenses of housing and transportation, especially since policymakers across the state are moving forward with plans to upgrade and extend public-transit options, including light rail, commuter rail, and bus rapid transit.
Light rail is already available in Mecklenburg County—and just this week, the federal government agreed to help fund an extension of the light rail system by 9.3 miles. Voters in Durham County affirmed that they wanted more affordable and expanded transit options last year, with voters in Orange County poised to follow suit next month. Wake County Commissioners failed to give voters the option to support expanded transit options last year but perhaps next year voters will have the chance to set the transportation agenda via the referendum process.
Policymakers in these counties should pay close attention to and seriously consider adopting the policy recommendations set forth in the new report to ensure that the benefits of transit investments are equitable and broadly shared. It is essential that policymakers focus on the needs of low-income people with an eye to where they live and work. Otherwise, the economic recovery will continue to bypass certain communities and further isolate vulnerable populations from economic opportunities.