Homeownership in Reach for More Renters
Laurie Goodman and John Zhu share news of a recently published Housing Affordability for Renters Index (HARI).
Goodman, Zhu, and colleagues at the Urban Institute created the HARI in March 2018, and have updated the index for 2019.
"The HARI improves upon other affordability measures by focusing exclusively on renters’ ability to buy homes," according to the post. "Moreover, unlike other indexes which focus on the average income, HARI evaluates the whole distribution of renter incomes in an area."
The report examines homeownership affordability for renters in 100 U.S. metropolitan statistical areas, using 2017 American Community Survey and the 2017 Home Mortgage Disclosure Act data.
The report summarizes its findings thusly: "For the nation as a whole in 2017, 27 percent of renters earned at least as much as households who recently purchased a home using a mortgage, a number similar to 2016. For most MSAs…affordability in 2017 was higher than it was in 2006, lower than it was in 2009, and similar to how it was in 2016."
For additional historical perspective: "For the 100 most-populous MSAs, houses were more affordable to local renters in 2017 than they were in 2006. In 2006, at the height of the housing bubble, fewer renters had the income to purchase a home. We observe an average of 6 percent more renters between 2006 and 2017 had the income to purchase a house."