A recent study shows that in cities where people spend more than 32 percent of their take-home pay on rent, a spike in homelessness will follow. With corporate landlords setting excessive prices in rental housing markets across the United States, it’s more obvious than ever that elected officials must regulate rents through rent control or rent stabilization policies. If not, it will literally cost lives – in the L.A. area, nearly 1,500 unhoused individuals died during the COVID-19 pandemic.
Politicians and Big Real Estate executives don’t like to tie homelessness to skyrocketing rents, but a study by Zillow Principal Economist Chris Glynn, Thomas Byrne of Boston University, and Dennis P. Culhane of the University of Pennsylvania shows that elected officials can no longer turn a blind eye to that devastating connection. The academic paper, titled “Inflection Points in Community-Level Homeless Rates,” was published last summer in The Annals of Applied Statistics.
According to a brief written by Glynn, his team found that communities “where people spend more than 32 percent of their income on rent can expect a more rapid increase in homelessness… The research also estimates that the scale of homelessness nationwide has been undercounted by roughly 115,000 people, or 20 percent.”
Glynn also noted his team found that “income growth has not kept pace with rents, leading to [a housing] affordability crunch with cascading effects that, for people on the bottom economic rung, increases the risk of homelessness.” Glynn further wrote that “the areas that are most vulnerable to rising rents, unaffordability, and poverty hold 15 percent of the U.S. population – and 47 percent of people experiencing homelessness.”
Glynn’s findings apply to such rental housing markets as New York, Boston, Los Angeles, and Seattle, where major corporate landlords Equity Residential, AvalonBay Communities, and Essex Property Trust operate. Corporate landlords charge sky-high rents to increase profits for investors, with other landlords following their lead and jacking up rents, too. Politicians should take note – and quickly act to protect tenants through rent control.
Glynn wrote that it “has long been a real estate rule of thumb that a person’s housing costs should not exceed roughly 30 percent of their income, and [his study] finds empirical evidence to support that adage at the community level. When the share of average income spent on rent in a community begins to meaningfully exceed that line, the risk of housing insecurity and/or homelessness rapidly increases. Establishing this link to community-level rent affordability in the first place provides an important nuance to conventional wisdom about the root causes of homelessness.”
Indeed. Too often, politicians cite all kinds of reasons for worsening homelessness, but curiously say little, if anything, about rising rents.
Glynn pointed out that in Los Angeles, “if affordability worsens by 2 percentage points – if renters are required to spend 51 percent of their income on a typical apartment, up from 49 percent at the time of this analysis – the number of homeless is likely to rise by an additional 4,227 people, or 6 percent above estimated 2017 levels.”
The impact of excessive rents can be lethal.
The Guardian recently found that, in 20 U.S. urban areas, the number of unhoused residents who died on the streets rose a staggering 77 percent between 2016 and 2020. In 2020, the tragic death toll went up to 5,000 people. UCLA researchers also found that nearly 1,500 unhoused individuals died in the L.A. area during the COVID-19 pandemic between March 2020 and July 2021.
Housing justice activists have long said that the housing affordability and homelessness crises are humanitarian catastrophes, upending millions of people’s lives and, in fact, killing unhoused residents. Yet corporate landlords and other predatory landlords continue to charge higher and higher rents, fueling the devastation. They can charge whatever they want because they’re not sufficiently regulated, if they’re regulated at all, in cities across the U.S.
It’s why rent control movements have taken hold in the U.S. – activists and residents know that people’s lives literally hang in the balance. Recently, housing justice activists around the country cheered the rent control victories in St. Paul and Minneapolis, Minnesota, where voters passed rent control ballot measures. Activists in those cities are now urging elected officials to quickly implement the people’s will – and not cave in to the demands of Big Real Estate.
In the end, rent control will save lives. But will politicians stand up to Big Real Estate? So far, they’ve only been interested in taking campaign contributions from the real estate industry and pushing its trickle-down, luxury-housing agenda, which fuels gentrification, more evictions, higher rents, and more homelessness. (Read our important book, Selling Off California: The Untold Story.) With Glynn’s findings, and a horrific increase in homeless deaths, politicians must change their ways.
Housing Is A Human Right continues to urge elected officials to immediately implement the “3 Ps”: protect tenants through rent control and other protections; preserve existing moderate- and low-income housing, not allow developers to demolish it; and produce more new moderate- and low-income housing. The time has come to put people over profits.