Study: Housing Divides U.S.

The number of Americans unable to secure decent and affordable housing is growing at an alarming rate, according a report released this week by Harvard's Joint Center for Housing Studies.

"The state of the nation's housing is not good," said William C. Apgar Jr., associate professor of city and regonial planning at the Kennedy School.

The report, prepared by Apgar and Professor of City and Regional Planning H. James Brown and sponsored by the Ford Foundation, says America is divided into two nations--"housing 'haves' and housing 'havenots.'"

The groups hit the hardest by the housing crunch are low-income and young households, the report says. Apgar said two million young households "would own a home today if the home ownership rates did not decline so sharply since 1980." Rent costs have also increased, rising at a rate 14 percent higher than other prices since 1981, according to the report.

The study cites lagging income growth, high real interest rates and sharp inflation in the late 1970s as major causes of the housing crunch.

Although actual home ownership costs have fallen from a peak in 1982, the cost of owning a typical "starter" home last year accounted for 32 percent of the average annual income of first-home buyers. This figure is up 50 percent from the 1970s, according to the study.

Because housing is so unaffordable, the report said families are forced to stay in rental homes. Brown and Apgar said in the study that they estimate, "Young, single parent families with children pay over 50 percent of their income on rent." And those who cannot afford to rent homes remain in subsidized housing or are forced onto the streets, the report says.

Apgar and Brown said they would not make specific policy recommendations because the study was intended to focus on the "breadth" of the situation.