A comprehensive report recently published by Lending Tree, an online loan marketplace, sheds light on the US housing crisis by analyzing census data pertaining to the nation's 50 largest metropolitan areas.
Meanwhile, the findings reveal a staggering 5.47 million vacant housing units, resulting in an average vacancy rate of 7.22 percent.
This includes owner-occupied units and rentals, encompassing single-family homes, apartments, and mobile homes.
We delve into the vacancies observed in these large metropolitan areas to provide a more accurate representation of the housing situation within regions where population density, job opportunities, and housing demand are higher.
US Vacancy Rates And Their Varied Causes
While the vacancy rates in metropolitan areas are historically not entirely uncommon, the report emphasizes that the reasons behind these vacancies differ significantly between US cities.
Factors contributing to vacant housing units range from vacation rentals and the rise of platforms like Airbnb to disinvestment, deteriorating conditions, and the mismatch between local wages and US house rent.
Moreover, a mere quarter of the vacant housing units are available for rent, while a mere 8 percent of the units are empty due to renovations. The remaining properties remain unused for at least part of the year, increasing the US housing crisis.
The Assumption Of Vacancies And Affordability
A commonly held notion is that higher vacancy rates lead to greater affordability. However, a recent report suggests no clear-cut relationship between the two. According to Jacob Channel, the author of the study, numerous factors influence home prices in a given area, making it far more complex.
Channel explains further, "It's not so simple to say high vacancy means low home prices or vice versa, because there are so many factors that go into play."
Understanding the reasons behind vacant homes plays a pivotal role in comprehending the cost of US house rent within a specific locality in the US.
US Rentals And Their Impact On Affordability
Approximately 26.6 percent of the nation's vacant housing units are actively up for rent, theoretically presenting more options for renters and the potential to alleviate housing costs.
Surprisingly, the metropolitan area with the most vacant properties available for rent is not considered affordable.
Meanwhile, with 16.6 percent of all vacant units actively on the market, New Orleans faces a shortage of 47,000 affordable units for low-income households.
The channel also suggests that the lack of affordability and high vacancies in New Orleans may be attributed to low wages and inadequate investment in existing housing.
Birmingham, Alabama, serves as another example of a city with high vacancy rates (10.72 percent), compounded by affordability challenges.
Thus, a combination of low wages and residential segregation has perpetuated the housing crisis in Birmingham. Meanwhile, the city recently attempted to tackle a growing homelessness issue using tiny homes.
Addressing The Crisis
Increasing the overall housing supply is one viable solution to the housing shortages and lack of affordable options. At the national level, the Department of Housing and Urban Development (HUD) spearheads efforts to solve this crisis.
Through various programs, HUD endeavors to boost affordable housing supply, such as the Self-Help Homeownership Opportunity Program (SHOP) and mortgage initiatives.
The Lending Tree report on the USA housing crisis starkly highlights the magnitude of housing vacancies across metropolitan areas.
Considering the complex web of causes, including short-term rentals, disinvestment, wage disparities, and inflated pricing, it becomes evident that effectively tackling the US housing crisis demands comprehensive strategies.
By prioritizing the expansion of affordable housing options and implementing targeted programs, it is possible to help individuals and families secure suitable homes, fostering a more equitable society.
Do you think US house rent will likely be affordable to low-income US families if the government looks into it? Let me know in the comments section below.