Policy Recommendations

Laws, policies, and even attitudes related to housing differ across states, counties, and municipalities. Every community is shaped by its own history, geography, economy, and demography, and as a result certain policy reforms appropriate for Phoenix might not work in Winston-Salem. Based on our research, however, we believe that certain policy recommendations are applicable to myriad communities across the United States. The recommendations are grouped into four broad categories: 1) Improve Housing Loss Data; 2) Prevent Housing Loss; 3) Expand Affordable Housing Options; and 4) Broaden Tenants’ Rights.¹

A lack of standardized data was a limiting factor in our ability to study and track housing loss. Without standardized data it is impossible to understand the full scope of the crisis, and craft policy responses to successfully respond.

Establish National Database on Evictions: There is no national system in place to track evictions. And while critical work by groups like Eviction Lab have helped to bring to light the crisis that plagues our cities, even their databases remain incomplete. The Eviction Crisis Act of 2019, introduced by Sen. Michael Bennet (D-Colo.), would have created a comprehensive national eviction database, allowing the government to better track and respond to the eviction crisis. Congress should pass the Eviction Crisis Act, or work with HUD to develop a publicly available national eviction database.

Improve Foreclosure Tracking Databases: The federal government should improve available data on foreclosures in two ways. First: While there is a national default and foreclosure database, it contains limited public information. While this database has existed since 2010, it's clear that HUD has not populated it to the extent that it would be useful for analysis. This forces researchers to turn to private data companies like ATTOM to source foreclosure data at scale.

Second: Congress should establish a database that tracks tax foreclosures. Currently different municipalities across the country collect data differently, if at all, limiting the possibility for wide scale research on the occurrence of tax foreclosures.

Develop Strategies to Monitor Informal Housing Loss: Throughout our research we heard stories of families losing their homes through partition sales of heirs property, informal evictions, and redevelopment of colonias along the U.S-Mexico Border. These forms of housing loss often impact the most vulnerable in our communities, and yet these displacements are almost never tracked. We must dedicate resources to mapping this informal loss and developing strategies to support those at risk.

Various experts we engaged indicated the need for a fundamental shift from responding to housing loss, to preventing it. Much of the available housing funding is allocated toward addressing needs that arise after displacement occurs, when it would be more efficient and effective to develop policies that prevent displacement from occurring in the first place.

Raise Wages: Across more than 60 key informant interviews, the most frequently cited reason for housing loss was an inability to make housing payments due to low wages. Our lowest-paid American workers, often earning only the federal minimum wage rate of $7.25 per hour, are confronting dual oppressive forces: stagnant wages and a mismatch between available work and the local laborshed.

First: The U.S. government must raise the minimum wage. U.S. wages have remained relatively stagnant since the 1970s. Many states do not set a minimum wage higher than the federal rate of $7.25 per hour. Some of these states even prohibit cities and counties from establishing their own wages to be more consistent with local costs of living. 1.6 million in the United States earn exactly or less than the federal minimum wage, putting them at risk for housing instability.

Next: We must make more workers competitive for well-paying jobs. Across the United States, jobs that require postsecondary education and credentials are growing more rapidly than jobs that require only a high school diploma. The share of available service work (e.g., hospitality and retail) is contracting and certain roles in industries that once guaranteed a middle class lifestyle without requiring a college degree (e.g., manufacturing) are going away. In fact, as of January 2020 70 percent of the workforce held jobs that required—or paid a premium to those who held—a postsecondary degree, but only half of working age Americans had one. Unable to qualify for high-paying jobs, these workers are left unable to afford basic necessities including housing.

Expand Socioeconomic Benefits: Housing is not the only major expense that families must pay; others include healthcare, childcare, transportation, and groceries. The costlier each slice of the household expenditure pie, the less there is left over for other expenses. These costs, when paired with high housing costs, impede a household’s ability to pay rent or keep up with mortgage payments. Providing both healthcare and childcare at affordable rates would help to ensure families don't have to choose between paying for housing and paying for medical treatment or safe care for their children.

For example, over 13 percent of Americans lack health insurance, and the number has been rising since 2018. Lack of insurance leads to significant unplanned expenditures in case of illness, rendering families unable to make rent and mortgage payments. Indeed, in each of our three deep dive locations we found that as the percentage of households without health insurance increases, so does the rate of evictions, foreclosures, and overall housing loss.

Childcare is another major expense, and for too many a large financial burden. According to the Department of Health and Human Services, childcare expenses for two children at a center costs more than average mortgage and rent payments in 35 states and the District of Columbia. Childcare is considered affordable if families spend only 7 percent of their income on expenses, however, no state in the country has an average childcare cost below 11 percent of annual income. The New America Care Report found that an individual earning minimum wage would need to spend two-thirds of their earnings to cover full time in-center care for just one child.

Establish Permanent Foreclosure Prevention Programs: In the years since the 2008 financial crisis federal programs targeted at struggling homeowners have expired, despite continuing housing loss throughout the country. The National Foreclosure Mitigation Counseling (NFCM) Program established in 2007 to support families on the verge of foreclosure understand their rights and the process. However, after supporting over 2 million households during the height of the Great Recession, the program ended in 2015. Similarly, 18 states and the District of Columbia received allocations from the Treasury Department’s Hardest Hit Fund, established in 2010 to help homeowners make mortgage payments and mitigate underwater mortgages. Originally funded with over $7 billion, the program received $2 billion in additional funding in 2016, however, states only have by the end of 2020 to utilize the funds before the program expires.

Congress should consider allocating more permanent funding for programs that prevent housing loss through foreclosure. This could be done through Community Development Block Grants or direct funding to housing authorities. In June, amidst the economic fallout from the Coronavirus Pandemic, HUD allocated $40 million of CARES Act funding to foreclosure prevention counseling programs across the country, showing the acute need for continued funding.

Develop Tools to Target Assistance: Applying for and receiving housing assistance is complicated and onerous. Public housing authorities should use enrollment information from other government benefit programs to strategically target housing interventions to those in most need. This could be done using lists of residents who are enrolled in programs such as SNAP (Supplemental Nutrition Assistance Program), TANF (Temporary Assistance for Needy Families), free and reduced school lunch, and WIC (Special Supplemental Nutrition Program for Women, Infants, and Children).

Reconsider State Preemption of Local Housing Solutions: Local governments have an array of tools they can use to drive more affordable housing development, maintain housing affordability, or raise wages for low-income workers. However, a number of states across the country have passed laws that limit or prohibit tools such as inclusionary zoning, minimum wage laws, or even the right to regulate short-term vacation rentals like Airbnb. These laws should be reconsidered in order to remove local limitations on policy responses to housing loss.

While it is clear that simply building more affordable housing will not solve the complex realities of housing insecurity, expanding the stock of housing available to low- and very-low-income households is a critical component of a broader solution.

Expand the Low-Income Housing Tax Credit Program: There is a real need to reconsider how affordable housing is financed across the United States. Current reliance on the Low-Income Housing Tax Credit (LIHTC) is not producing nearly enough units to address the multi-million unit deficit of affordable housing. And still, most LIHTC buildings are unaffordable to families that earn very low or no income. HUD should adjust rates to ensure all low-income families can qualify to live in LIHTC buildings. One way to expand access for very low-income households, would be to better coordinate project-based housing vouchers and tax credit projects to help families make up the difference in rent payments.

Further, as a result of community pushback and NIMBYism, many LIHTC projects are built in areas already struggling with high rates of poverty. State or local policy reformation that would allow LIHTC projects to be built “by-right,” or without a full vote needed by city councils or planning commissions, would greatly improve the ability of developers to build affordable housing in high opportunity areas.

Adequately Appropriate Funding to Housing Trust Funds: Housing trust funds (HTF) at every level of government would support the development of affordable housing. The National Housing Trust Fund, established in 2008, saw its first state allocations in 2016 totaling over $170 million dollars. In 2018 over $260 million dollars was dispersed to states, but the National Low Income Housing Coalition says more resources are needed to keep up with demand. In 2018, over 1,800 organizations wrote to congress asking them to appropriate $3.5 billion annually to the trust fund, which is disbursed to states as a block grant. This funding type allows for flexibility in usage, providing states a tool they can tailor to their specific needs. Congress must appropriate more funding to the National Housing Trust Fund to support the development, stabilization, and preservation of housing across the country.

City and county governments can also work to expand or establish housing trust funds. Funding could be sourced from a small sales tax, filing or application fees, or through specific developer fees attached to market rate construction. In 2016, county trust funds across the country raised over $100 million for affordable housing projects through various revenue sources including developer impact fees, document recording fees, and real estate excise taxes.

Expand Housing Voucher Programs: Across the country 20 million households are eligible for vouchers based on their income, and yet, over 70 percent do not receive housing vouchers as a result of limited funding. Some households who are eligible for vouchers wait years to receive them, perpetuating the rent burden for millions of families on the waiting list.

Every family eligible for housing vouchers should receive them, and congress must appropriate new incremental vouchers for disbursement through HUD to local public housing agencies. These could be in the form of general housing choice vouchers, or be targeted at specific population groups including homeless families (CoC), seniors, or veterans (VASH). Studies show that one-third of households who receive vouchers will be lifted out of poverty, freeing up cash for other expenses including childcare and food, and allow families to afford housing in higher opportunity areas.

Expand the use of Inclusionary Zoning: Almost 900 jurisdictions in 25 states utilize inclusionary housing policies to drive the development of affordable housing. Across the United States inclusionary housing policies have created 50,000 new homeownership units, over 120,000 units of affordable rental housing, and over 2,000 affordable single-family homes.

Some states like Arizona prohibit local authorities from enacting inclusionary zoning to bolster the development of affordable housing. States with preemption laws should allow local jurisdictions to establish inclusionary zoning programs if they wish. This would help cities and counties to better incentivize the development of affordable units for lower-income residents using methods tailored to their unique circumstances.

Ban Income Source Discrimination: Fifteen states and over 90 cities and counties across the country have laws banning source of income discrimination in housing rentals. Landlords who refuse applications from Housing Choice Voucher program participants, or refuse to receive social security or veterans’ benefits, are discriminating against tenants on the basis of source of income. Banning this type of discrimination is essential to fully realizing the potential of federal housing benifits.

The success of policies that prohibit discrimination is clear. In areas where there are no income source discrimination laws, landlords reject 77 percent of tenants who rely on vouchers. This percentage falls to 35 percent, however, in areas where there are protections for voucher holders.

Support Innovative and Equitable Revitalization: As cities struggle with a shortage of affordable living options, the tendency of developers to target low-income neighborhoods for redevelopment is pernicious. Cities must think about ways to preserve neighborhoods and prevent the displacement of long-time residents as a result of gentrification.

One method for neighborhood stabilization and preservation of affordability is the use of community land trusts (CLTs). Land trusts work to prevent property from being sold to developers by giving owners the option to sell to the trust. This allows the trust to maintain the availability of affordable housing options in the neighborhood.

Advocate for Changing HUD Definition of Homelessness: 2012 changes to HUD’s definition of homelessness have limited the support available to those who are unstably housed. Families who live in overcrowded or precarious housing are not considered homeless and so barred from receiving homeless support and funding for rehousing. Additionally, service organizations and local governments cannot count these families as homeless in funding allocation requests. As a result, those experiencing housing instability, but who do not meet the narrow HUD criteria, are barred from accessing much needed housing services and support. A broad definition of homelessness would better capture the diverse experiences of those facing housing instability. This could expand the reach of homeless service programs to families currently excluded and create a more robust continuum of care.

A vast information and power asymmetry exists between landlords and tenants. Whereas homeowners are protected by multiple legal and financial instruments stemming from the 2008 financial crisis, tenants are—as one expert told us—at the mercy of their landlord. The following policy recommendations aim to shrink the gulf between landlords and tenants, and increase tenants’ bargaining power.

Guarantee Tenants a Right to Counsel: Some cities, including New York City, Los Angeles, Philadelphia, and Cleveland, have experimented with programs to guarantee legal representation to tenants facing eviction. In New York City, before their right to counsel program was established, just 1 percent of tenants had legal representation in eviction court. After program implementation, in the zip codes where the program was active, over half of tenants all were represented, and over 80 percent were able to remain in their homes. The program has also contributed to an 11 percent reduction in eviction filings versus other areas of the city that are not yet participating in the program. The success of this program is clear, and should be expanded nationwide.

Expand Representation for Undocumented Households: We must create legal aid programs for undocumented or mix-status households. Many federally funded legal-aid programs are unable to serve those without legal residency, excluding households who need legal representation the most. Landlords may exploit a household’s immigration status in order to provide substandard housing or proceed with informal evictions. These households often have few options for recourse, and with legal-aid programs unable to help them, they are vulnerable to repeated abuses.

Increase Bilingual Accommodations in Court: The lack of bilingual information within the court system places an unfair burden on the millions of households who dont speak or read English. Legal jargon is difficult to understand for even those well versed in the English language. Courts around the country should provide increased accommodations in legal proceedings for those who are not English proficient.

Ensure Right to Withhold Laws: A majority of states allow tenants to place money in escrow or with the court system if a rental unit becomes substandard in quality. However, some states like Indiana and Arkansas have no laws in place to protect tenants from landlords who refuse to maintain their property. The ability to withhold rent, or even “repair and deduct,” is an effective method to empower tenants vis-a-vis negligent or malicious landlords.

Just Cause Eviction Laws: In many cities and states, landlords are not required to provide a reason for the eviction of tenants approaching the end of their lease term or who may not have a formal lease agreement. These evictions are typically categorized as “no cause” evictions. “Just cause” eviction policies can prevent displacement through evictions by stipulating that there are only certain grounds upon which a landlord may pursue an eviction (e.g. nonpayment of rent, noncompliance with the terms of a lease).

Support Tenant Education: In many localities, tenants facing a formal or informal eviction notice are not aware of their rights or resources available to them. In some cases, local tenants’ rights organizations advocate for widespread education about rights and resources. Local policymakers should facilitate connections between these organizations and tenants, as these networks can help to build stronger systems of social safety nets and expand the continuum of care.