by Alexis Perrotta, Associate Planner, RPA
Here are three things you probably didn't know about housing in the region:
These findings come from Out of Balance: The Housing Crisis from a Regional Perspective, a study of housing trends in the NY-NJ-CT region recently released by RPA and the Citizen's Housing and Planning Council (CHPC). You can see the whole report at www.rpa.org. The facts just mentioned, while interesting, point to a more challenging reality: this is still one of the least affordable places to live, and many of the underlying problems are worsening.
Although it's long been known that housing is expensive here, there has been relatively little study of housing in a regional context, even though the market for housing is clearly regional in nature. The study tries to provide a larger context for the ongoing debate on the implications of rising housing costs, which too often plays out in the media on a micro-level, with little explanation of broader causes.
When the NY-NJ-CT region is compared with the nine other most populous regions in the United States, it does not rank as the most expensive, but it comes in a close second by two measures. The Los Angeles region is less affordable for a greater share of households, and the San Francisco region has higher housing prices overall.
Looking within our region, the study highlights differences between Manhattan, the urban core (the outer boroughs of New York plus Essex, Union and Hudson counties in New Jersey), and the inner and outer suburban rings. Stratifying the region by urban/suburban rings helped describe the region more accurately than dividing it by the three states, and it led to some interesting findings. For example, housing affordability is a bigger problem in the suburbs than in the urban core for moderate income groups. Thirty seven percent of households earning $20,000 to $75,000 per year in the suburbs pay more than 35% of income in housing costs, compared with 27% of those households in the urban core. Nevertheless, lower income households have the most severe housing cost burdens and are concentrated in the urban core.
The urban/suburban rings highlight the intra-regional dynamic of the housing market. Jobs in the suburbs pay lower wages than jobs in the city, yet the workers who have those lower-paying jobs in the suburbs have a harder time finding an affordable place to live near where they work. Recent data indicate that the trend for the suburbs to have low wages and high housing prices is increasing: some of the fastest growing occupations in the suburbs are home health care aids and child care workers, which are generally not high paying jobs. Likewise, commute times are increasing region-wide, indicating a jobs-housing location mismatch.
Because the study examined the relationship between housing and income, the economy, commuting patterns, and land use, it required looking at a lot of data in addition to housing costs and income. Some of this revealed that there is a mismatch between household size and housing unit size. Most people in this region live alone or with only one other person. Just under half of these are singles living alone; 44 percent are related pairs (usually married couples or a parent with one child); and eight percent are two-person, unrelated households. This is similar to household size and composition in the U.S. overall and in most large metropolitan regions, even though it includes Manhattan where more than 75% of households are made up of one or two people.
Household size has implications for residential real estate development and housing policy. Most of the housing being built in the region is made up of detached houses, usually with two to three bedrooms, intended for a family. There are only 2.3 million studios and one-bedroom houses and apartments in the region for the 4.4 million one- and two-person households. At the other end of the spectrum there are more than 1.5 million very large houses (more than five bedrooms) while there are only about one million households with more than four members. One question is whether this type of housing is preferred by the many small households in the region, or whether it is being built to fill another demand, such as the demand for second and third houses of larger and/or wealthier households. Future work of the RPA/CHPC collaboration will examine the policies that encourage these trends.
To provide an appropriate context for a very complicated issue, the study identifies the critical nature of the NY-NJ-CT housing crisis. Twenty nine percent of households - or more than two million families - pay more than 35% of their income in housing costs. More than half of those families pay more than 50% of their income in housing costs. The situation has gotten worse over the last ten years, even as incomes have increased in most of the region.
Overall, by three key standards - affordability, choice and quality - both urban and suburban areas of the region are failing to provide the housing necessary to support the goals of economic competitiveness, social equity and environmental sustainability.
Here are three things you probably didn't know about housing in the region:
- This region's housing market is not the most expensive in the country (but it's a close second).
- For moderate income households, the suburbs are even less affordable than the urban core.
- More than half of the region's households are composed of only one or two people, even though that's generally not for whom developers are building.
These findings come from Out of Balance: The Housing Crisis from a Regional Perspective, a study of housing trends in the NY-NJ-CT region recently released by RPA and the Citizen's Housing and Planning Council (CHPC). You can see the whole report at www.rpa.org. The facts just mentioned, while interesting, point to a more challenging reality: this is still one of the least affordable places to live, and many of the underlying problems are worsening.
Although it's long been known that housing is expensive here, there has been relatively little study of housing in a regional context, even though the market for housing is clearly regional in nature. The study tries to provide a larger context for the ongoing debate on the implications of rising housing costs, which too often plays out in the media on a micro-level, with little explanation of broader causes.
When the NY-NJ-CT region is compared with the nine other most populous regions in the United States, it does not rank as the most expensive, but it comes in a close second by two measures. The Los Angeles region is less affordable for a greater share of households, and the San Francisco region has higher housing prices overall.
Looking within our region, the study highlights differences between Manhattan, the urban core (the outer boroughs of New York plus Essex, Union and Hudson counties in New Jersey), and the inner and outer suburban rings. Stratifying the region by urban/suburban rings helped describe the region more accurately than dividing it by the three states, and it led to some interesting findings. For example, housing affordability is a bigger problem in the suburbs than in the urban core for moderate income groups. Thirty seven percent of households earning $20,000 to $75,000 per year in the suburbs pay more than 35% of income in housing costs, compared with 27% of those households in the urban core. Nevertheless, lower income households have the most severe housing cost burdens and are concentrated in the urban core.
The urban/suburban rings highlight the intra-regional dynamic of the housing market. Jobs in the suburbs pay lower wages than jobs in the city, yet the workers who have those lower-paying jobs in the suburbs have a harder time finding an affordable place to live near where they work. Recent data indicate that the trend for the suburbs to have low wages and high housing prices is increasing: some of the fastest growing occupations in the suburbs are home health care aids and child care workers, which are generally not high paying jobs. Likewise, commute times are increasing region-wide, indicating a jobs-housing location mismatch.
Because the study examined the relationship between housing and income, the economy, commuting patterns, and land use, it required looking at a lot of data in addition to housing costs and income. Some of this revealed that there is a mismatch between household size and housing unit size. Most people in this region live alone or with only one other person. Just under half of these are singles living alone; 44 percent are related pairs (usually married couples or a parent with one child); and eight percent are two-person, unrelated households. This is similar to household size and composition in the U.S. overall and in most large metropolitan regions, even though it includes Manhattan where more than 75% of households are made up of one or two people.
Household size has implications for residential real estate development and housing policy. Most of the housing being built in the region is made up of detached houses, usually with two to three bedrooms, intended for a family. There are only 2.3 million studios and one-bedroom houses and apartments in the region for the 4.4 million one- and two-person households. At the other end of the spectrum there are more than 1.5 million very large houses (more than five bedrooms) while there are only about one million households with more than four members. One question is whether this type of housing is preferred by the many small households in the region, or whether it is being built to fill another demand, such as the demand for second and third houses of larger and/or wealthier households. Future work of the RPA/CHPC collaboration will examine the policies that encourage these trends.
To provide an appropriate context for a very complicated issue, the study identifies the critical nature of the NY-NJ-CT housing crisis. Twenty nine percent of households - or more than two million families - pay more than 35% of their income in housing costs. More than half of those families pay more than 50% of their income in housing costs. The situation has gotten worse over the last ten years, even as incomes have increased in most of the region.
Overall, by three key standards - affordability, choice and quality - both urban and suburban areas of the region are failing to provide the housing necessary to support the goals of economic competitiveness, social equity and environmental sustainability.
@RegionalPlan