Assistance from the government for housing is not keeping up with the market, according to a new analysis by Zillow. Assistance granted as part of the U.S. Department of Housing and Urban Development’s (HUD) Housing Choice Voucher program misses the mark in the majority of metropolitan areas, the analysis shows.
HUD determines the value of the vouchers—worth enough to rent at least 40 percent of rentals in a given market—by its Fair Market Rent index (FMR). The analysis shows the FMR and vouchers fall short in 75 of the 100 largest metropolitan areas in the U.S. Moreover, the FMR is not matching the pace of rents, as tracked in the Zillow Rent Index (ZRI):
“Many markets with strong rent growth tend to also have the types of jobs that could help renters climb the socioeconomic ladder,” says Dr. Svenja Gudell, chief economist at Zillow. “However, many low-income households—even those with a voucher—are increasingly being priced out of these markets, unable to find affordable housing options near these jobs. If rents and HUD’s Fair Market Rents continue to move at different paces, this affordability crisis will only worsen for low-income renters.”
For more information, please visit www.zillow.com.
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