Low income + high rents = homelessness September 13-19, 2023

America’s homelessness crisis is much worse in some coastal cities. The per capita homeless population in Seattle and San Francisco is five times that of Chicago and Detroit. why is that? In their book “Homelessness is a Housing Problem: How Structural Factors Explain American Patterns,” University of Washington professor Greg Colburn and data scientist Clayton Page Aldern use detailed statistical analysis to explain regional variation in homelessness rates across major metropolitan areas in the United States. The title of their book spoils what the data reveal: “Regional variation in homelessness rates can be explained by housing costs and availability.”

There are many strongly held opinions about the main causes of homelessness. Popular ones focus on the personality traits and behaviors of homeless individuals. The researchers analyzed several of these factors, including poverty, labor markets, race, addiction, and mental illness. The data shows that although individual factors may have led to a particular individual becoming homeless, there is no positive statistical relationship regarding differences in homelessness rates between areas.

For example, Midwestern cities like Detroit, Cleveland, and Chicago have higher poverty rates but lower homelessness than coastal cities. The consequences of poverty in coastal cities are even more profound. Coastal cities also have strong job markets, with high rates of homelessness.

Regarding race, Blacks make up 13% of Americans, but 40% of the homeless population, largely due to historical (and current) racial structural disadvantages in housing, lending practices, education, health care, employment, policing, and incarceration. “You have to have fewer things going wrong in your life that you end up losing your housing if you’re black.” But cities with large black populations, such as Detroit and Baltimore, have lower rates of homelessness than coastal cities.

It is “a persistent argument that some cities have created a culture that encourages homelessness to flourish and persist — as a practice and a choice.” This means that when communities provide homeless people with “destructive compassion” in the form of support programs, the argument goes, you are actually encouraging homelessness. The data shows the opposite. Access to assistance programs reduces homelessness, and it is not uncommon for homeless people to move to cities with more generous assistance programs. Homeless individuals are actually less mobile than housed persons. More than 80% of people experiencing homelessness remain in the same community after becoming homeless. This is not surprising, given the importance of community in helping a person emerge from homelessness.

Regarding mental health and substance abuse, studies indicate that “between 25 and 40 percent of homeless (i.e., non-family) individuals suffer from a substance use disorder and that approximately one-quarter of the single adult population suffers from some form of mental illness.” I reiterate that the majority of people experiencing homelessness do not suffer from these conditions. Also, “the vast majority of people suffering from these conditions never lose their homes.”

It is true that the longer a person experiences homelessness, the more “scarring” they experience and the more difficult it is for them to emerge from homelessness. It is not surprising that the harsh and painful conditions of homelessness often lead people to use drugs and alcohol to cope. But mental illness and addiction do not explain differences in homelessness rates between regions.

The data showed regional differences in homelessness in vacancy rates and housing costs. Once the cost of housing exceeds 30% of household income, the rate of homelessness rises. Low income with high rents leads to homelessness. When vacancy rates in rental properties are low, rents rise accordingly. Thus, low vacancy rates join high rental costs “as the only variables explaining regional variation in homelessness.”

The issue is not limited to a lack of housing for low-income people; The general housing shortage leads to homelessness.

Fast-growing areas do not necessarily experience increased homelessness. Communities with growing populations that build enough new housing do not see growth in homelessness. Coastal cities tend to face geographic constraints, such as water or mountains, which limit new housing construction. These restrictions are less common in the Midwest; Midwestern cities are therefore better able to build more housing to meet demand.

Seattle embodies the “perfect storm” of housing instability and homelessness: high population growth, combined with restrictions on new construction, have led to high housing costs and low vacancy rates. “Zoning regulations help explain why there is a lack of multifamily housing in Seattle.” In Seattle, multifamily housing is illegal on nearly 70% of the city’s residential lots.

It’s not just Seattle. Many cities have complex regulatory approval processes that slow down the construction process. Land use restrictions, including “minimum lot sizes, height limits, setbacks, and open space requirements,” all serve to limit the new housing required, whether permanent or transitional, such as tiny homes.

“If we understand homelessness as a housing problem, we can also understand it as solvable,” the authors write. Instead, “much of the money spent on homelessness today is a response to the crisis rather than an alternative to it.”

So, what’s the alternative? “The recipe is simple: Policymakers should increase the number of affordable housing units and provide subsidies and rental assistance to families to ensure they have access to housing.” To achieve this, the authors establish several required steps.

“First, public perception of homelessness must change.” The media and policymakers must stop portraying homelessness as an individual problem. The dehumanization of homeless people must stop. Instead, the authors encourage an understanding of homelessness “as inherently structural, rather than the result of poor decisions or social deviance.”

We need new, effective permanent housing programs. “Housing should be a non-commodity.” A portion of the housing stock must be separated from the private market. Societal understanding of housing must change, so we understand housing for low-income families as a public good. In our cities, we must move away from the norm of single-family housing, which will be supported by “homeowners who want to advocate and vote for greater housing density; people who want to live on less space.”

We need far greater resources dedicated to homelessness from all levels of government. Currently, the federal government allocates a relatively low amount of funding to low-income housing, while sacrificing significant tax revenue through the mortgage interest tax deduction. This deduction could be eliminated and these revenues could be directed toward expanding existing federal housing programs, including shelters, transitional housing, safe havens, rapid rehousing, and permanent supportive housing. At the state and local levels, we need to expand rental subsidies for families facing homelessness and invest in affordable and transitional housing. We also need to review zoning so that it facilitates the construction of affordable housing, allows alternative forms of housing (such as tiny homes) and encourages new construction technologies (such as building blocks from recycled plastic).

Are all these changes affordable?

In fact, these required investments can save taxpayers money. The authors cite studies from the United States and Canada that “show that the annual costs of homelessness range from $30,000 to $100,000 per person.” Costs associated with homelessness include “police, prisons, probation, parole, courts, emergency department, hospital admissions, ambulances, mental health, and homelessness services data.”

And don’t forget the cost to people experiencing homelessness. There’s the financial burden of being poor, but being homeless also means you get sick more often and are “more likely to be victims of physical and sexual abuse.” Homeless people also die tragically at younger ages than residential residents. “Homelessness causes great harm to society,” both for the homeless and housed.

Can we actually make these changes and significantly reduce homelessness in America? As proof that we can, the authors point to recent government actions that, between 2009 and 2019, reduced homelessness among American veterans by 50%! To this end, policymakers demonstrated political will and committed resources and mobilized numerous federal agencies.

This is proof positive that it can be done, if we decide to do it.

Read more in the September 13-19, 2023 issue.