Housing Affordability Crisis in New York City

Housing Affordability Crisis in New York City
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Housing Affordability Crisis in New York City
One of the main housing problems in the 21st century is affordability relative to household income. According to Lee et al. (2022), housing affordability has reduced in recent decades, affecting developing and developed economies. The lack of affordable housing has affected housing accessibility among low- and middle-income households. Evidence shows that the ratio of the cost of housing to household income has increased in most countries, contributing to high-cost burdens for housing (Lee et al., 2022). This problem is particularly prevalent in major cities globally. This paper's purpose is to assess the low housing affordability problem in the United States (US) and, more specifically, in New York City (NYC). The paper will also explore the impact of low housing affordability on the elderly living in NYC.
Housing Affordability in the United States
The US is one of the developed economies facing major housing problems. The housing affordability crisis is particularly prevalent in the US. It is characterized by rising housing prices for homeowners and renters. According to Burns et al. (2021), the rate of home ownership in the US has continued to decline since the 2008 Great Recession. This has forced many American families to rent houses, contributing to high rental costs. Also, there has been a decline in affordable housing due to the high costs of land and housing, contributing to low housing affordability (Burns et al., 2021). As such, the lack of affordable housing is a major problem facing the US.
According to a recent Pew Research Center article, the median home sales price has increased in recent years, and the number of active listings in the country has reduced (Schaeffer, 2022). This has contributed to an increase in housing prices and overall spending on housing. In fact, almost half of American renters and about a quarter spend over 30% and over 50% of their income on rent, respectively (Schaeffer, 2022). While spending 30% on rent is within the acceptable limit, more Americans feel that the cost of housing is too high. They are cost-burdened because they must pay more than the recommended amount for housing. According to Schaeffer (2022), in the last five years alone, rent has gone up by at least 18%, more than the rise in inflation. In addition, the incomes generated by households have not kept up with the rising cost of housing, contributing to a housing affordability crisis. The crisis has mostly affected people from low- and middle-income households.
The recent COVID-19 pandemic and the subsequent recession have only worsened the issue. According to the US Government Accountability Office (n.d.), many renters and homeowners in the US have been unable to raise their rental and mortgage payments due to the financial challenges created by the pandemic. Also, Kenan Institute (2023) indicates that the demand for housing went up when people started working from home due to the pandemic, yet, the US needs about 5 million extra homes to meet the demand for housing. This mismatch in demand and supply of housing has furth...