Foreclosures Overshadowed Lack of Affordable Housing

by Peter Vernon on Foreclosure Crisis

You would think that with the growing number of foreclosure homes everyday there is a never ending supply of low-priced houses for every American family. But not for working poor renters in the Washington area.

An increasing number of working poor renters in the area are asking local government agencies for help in meeting their basic needs, such as payment for utility bills and rental assistance.

This development indicated that recession is not only causing the spread of foreclosure homes but also the lack of affordable housing for people who are way down below the economic ladder.

Most of these working poor renters could barely make ends meet and home ownership is the farthest thing from their minds. And just like distressed homeowners who are facing the prospect of foreclosure homes, working poor renters are also on their way to being homeless.

Despite the significant decline in home prices and the increasing number of foreclosure homes, affordable units for rent in the Washington area remain scarce and limited.

Affordable housing should cost not over 30 percent of a family’s income. However, many renters in the region are using a big portion of their income for rent.

Most rental units in the area are still high-priced and working poor renters do not have the necessary funds to buy even modest foreclosure homes.

Coalition for Smarter Growth housing director Melissa Bondi said that the foreclosure crisis eclipsed other problems, particularly the immediate need for rental units that would be affordable for working poor people.

She noted that money for a $500,000 property in foreclosure is very hard to come by for a working poor who is paid hourly.

In Washington, a one-bedroom apartment located in a less-than affluent neighborhood could fetch a monthly rental of $1,000, an amount hard to generate for an individual who earns $10.40 per hour.

Meanwhile, officials in Arlington County have noticed a 38 percent rise in the number of people who applied for the county’s rental supplement program. The program offers cash grants to working poor renters to help pay their bills.

Recently, members of the Arlington County board increased the $4.3 million available cash grant to about $4.6 million to help renters avoid homelessness.

And just like distressed homeowners who are facing the threat of foreclosures, troubled renters are also dreading the day eviction would come to their doorstep.