How the Age of Housing Impacts Affordability
Housing affordability is an incredibly complex issue that is measured by many indicators and metrics, including household income, property values, cost of construction, and cost-burdened households. Yet, the prevailing issue of housing affordability is largely one of supply and demand.
We will focus on one of the supply-side components - the age of housing stock. Older homes have traditionally been an affordable option for both renters and home buyers as they deteriorate over time and become cheaper, a theoretical process called "Filtering." However, "this process relies on a balanced supply of units of varying age and cost, and a lack of new affordable construction can prevent older units from filtering down," as stated by an apartmentslist article . It's also important to note that not all areas of older homes are inherently affordable, as affluent households have often resided in old, grandeur houses.
This story will explore these concepts related to housing through various different lenses: Housing Booms, Housing Affordability, and Policy Options.
Housing Booms
Let's first look at the median year housing units were built to see if there are any patterns in the age of housing units and the housing affordability of the area. We're now able to view that data easier than ever thanks to the new ACS Housing Units by Year Built Variables in the Living Atlas of the World.
One way to use this dataset is to map by predominant period that housing units were built. Predominance simply means ‘Of the housing available in this area today, which decade provided the most housing units?' This is a great way to be able to see where large migrations happened in the US, and their subsequent housing booms that followed.
This map shows the predominant period that housing units were built at the state level. States in red indicate where housing units were most commonly built 1939 or earlier , while states that are green shows where housing units were predominantly built between 1990 - 2009.
We are clearly able to see where in the US regions such as the Rust Belt and Sun Belt are located. The Rust Belt, composed of the Northeastern and Midwestern states that were once dominated by manufacturing jobs, saw housing booms prior to 1939, as shown in red. The Sun Belt, composed of the southern states, saw large migrations from the Rust Belt and subsequently saw housing booms after the 1970s in green and blue.
Click on any part of the map for more details.
The suburban flight from the cities in the 1950s saw mass migrations of people from bustling cities sprawling out to the bedroom communities of the suburbs. By zooming into the map, we see the pattern at the county level. Areas in dark purple where America's first suburb was created, Levittown, in Nassau County, New York.
We're able to see similar patterns in other large Northeast U.S. cities on this map, where neighboring counties to Philadelphia and Baltimore counties see suburban housing in the 1950s become predominant.
Click on any part of the map for more details.
If we zoom in to a city center such as Minneapolis, MN, we can now see the pattern by Census tracts. The city center is predominantly red, indicating that the homes were built prior to 1939. This is common for many city centers that were built early in US history, and then the cities expanded over time.
Just outside the red we see cooler colors of dark blue and purple, showing where the first ring, or inner suburbs, were built post-WWII in the 1950's and 1960's.
The second ring suburbs, or outer suburbs, can be seen symbolized in green, where housing was predominantly in the 1990s and 2000s.
Click on any part of the map for more details.
Housing Affordability
Now that we're able to identify where housing booms have occurred in the US using the predominant period that housing units were built, let's shift our focus to the supply-and-demand side of the housing affordability issue.
Homeownership rates decline, and renter rates increase
This web app shows the comparison of homeownership between two time periods, 2010-2014 (left side) and 2015-2019 (right side). As you swipe left, look for areas that appear less blue or more yellow.
The rising demand of affordable housing is largely a renter housing issue in comparison to issues facing homeowners, as more U.S. households are headed by renters than at any point since at least 1965, according to a Pew Research Center analysis of Census Bureau housing data .
Use the two maps on the right to compare how homeownership rates have changed over time. Zoom to your city to see the pattern for you community.
Next, we will explore how income and housing costs are disproportionate for renters rather than homeowners.
Renters' wages mismatched with raising rent
Median renter household incomes have largely remained stagnant in comparison to raising median rental prices. Since 2001, the national median rent has risen 13%, a drastic rise compared to be only a 0.5% rise in median renter household income, as stated by the Center on Budget and Policy Priorities .
Median rent lower for older homes
The chart on the right shows us national figures for median gross rent by the year the structures were built. We can see that older homes are generally more affordable than newer homes.
Notice that houses built from 1989 and earlier are all overall lower median rent. Most houses built newer than that jump up in price based off the age of the house. This chart is a visual representation of the "Filtering" process.
Source: ACS 2019 1-yr Estimates. Table B25111
The size of housing stock matters
The chart on right shows that when it comes to the affordability of older housing stock, small (2-4 units) and medium (5-19 units) size multi-family structures have remained more affordable than single-family and large multifamily structures, according to Harvard's State of the Nations Housing 2020 Report .
The chart on the left shows that new construction has favored building single-family and larger multifamily buildings.
So while small and medium sized buildings are shown to be more affordable for renters, single-family homes have dominated new housing construction in the recent years.
Predominant Housing Structure Type
This map shows the predominant structure type of housing unit.
See the existing housing stock of your city by looking at the predominant housing structure by type.
View your city using the Search bar (magnify glass) in the top left corner, or check out the varying patterns from these cities below.
Click on any part of the map for more details.
Construction costs hinder building affordable housing
On the supply-side of housing affordability, a homebuilder perspective on housing affordability study from the Joint Centers for Housing Studies of Harvard stated the biggest issues to construction costs are the labor cost and availability of labor.
The study also stated another big issue to the lowering the construction cost was availability and cost of materials, namely lumber and plywood.
Regulatory barriers impact building affordable housing
The study also expressed regulatory barriers as another big impact on the cost of building homes. Namely builders cited the permitting and development approval process and land use/zoning controls as key regulatory barriers to building more affordable homes.
Cost-burdened Households
This map shows households that spend more than 30 percent of their income on housing, a threshold widely used by many affordable housing advocates and official government sources including Housing and Urban Development. Areas in purple are more likely to have renters who pay over 30% of their income towards rent, while areas in green are more likely to have owners who pay 30% or more of their income towards their mortgage. Areas in red have a high amount of both renters and owners who have burdensome housing costs.
According to a Harvard report , renters are more cost-burdened than homeowners, with 46% of renters cost burdened compared to 21% of homeowners.
See how cost-burdened households vary by city
Click on any part of the map for more details.
Median year housing units were built
This map shows the median age by the year that housing units were built. Areas in light orange show where median age of housing is newer, while brown shows where the median age of housing is the oldest.
View your city using the Search bar (magnify glass) in the top left corner, or check out the varying patterns from these cities below.
A prevalent pattern from all of these cities are newer housing in downtown census tracts, older housing surrounding the downtown, and newer housing in their respective suburbs.
In the next map, we'll explore the relationship between the age of housing and affordability.
Click on any part of the map for more details.
The relationship between housing age and affordability
This map shows the relationship between the median housing age by year built and the percent of renters that are cost-burdened. Light yellow shows areas with newer homes and lower percentage of cost-burden for renters, while areas in dark blue have older homes and higher cost-burden for renters.
Dark green shows newer homes that have a higher percentage of cost-burden renters.
Exploring this map at the city level shows pockets of where renters pay a higher proportion of rent even though they are living in older homes.
View other cities relationship between median housing age and cost-burden housing.
Click on any part of the map for more details.
Policy options to increase housing affordability
Zoning Reform
One of the biggest barriers to creating more housing supply are restrictive zoning regulations. By reforming zoning to be more inclusive of higher density housing such as townhomes, duplexes, and apartment buildings, the overall housing stock can become more affordable.
Cities can rezone, permitting the conversion from single-family homes to multifamily homes (duplex/triplex/quadplex, etc.).
State legislatures can also propose bills such as California's SB 1120 that would allow for existing single-family homes to be converted into duplexes and for single-family parcels to be subdivided into two lots.
Cities can also rezone to allow for Accessory Dwelling Units (ADUs) aka, Granny Flats, that are additional structures that can be built on an existing lot, or convert existing structures such as garages, into a residential structure. A HUD User case study found multiple cities across the U.S. that found success in making housing more affordable by implementing ADUs. One city planner out of Portland, Oregon stated, "That allowing more ADUs did increase the housing supply, and that city residents viewed ADUs positively and were satisfied with the changes made."
Both of these rezoning options can help increase a community’s housing supply, and since they cost significantly less to create, they are an affordable choice for creating new housing. They also have the added benefit of not altering the character of a neighborhood, which can be one argument against increasing housing density.
Direct Government Assistance
The Center for American Progress suggests the federal government can direct capital grants to the construction and management of new government-funded housing through Low-Income Housing Tax Credits (LIHTC), the Community Development Block Grants, and the HOME Investment Partnerships programs.
Tell Your Community's Story
These ACS layers amongst many others in the Living Atlas of the World are available for your work to help support your community in mapping and analysis to help advocate for affordable housing.
All the data used in this Story Map is derived from the U.S. Census Bureau's American Community Survey data. If you would like to view the feature layers, they are found on the Living Atlas of the World.
All ACS layers in ArcGIS Living Atlas show their data at state, county and tract levels of geography, making it easy to find patterns at different levels throughout the U.S.
Further reading
Continue reading about housing affordability from other story maps.