A third of the American population do not own their own homes, and of that third, roughly nine million Americans live in some form of Low Income housing. Low income housing is one of the most basic forms of welfare a state can provide. In the United States, there are two main options for low income housing; Affordable and Public. While these two forms of housing are often conflated, they are two entirely different things. While they may differ, however, both options are deeply flawed.
First, Low Income has to be defined. In terms of housing, it means a something very specific. Low Income families are families that make less than 60% of the average income for the designated area they are applying for housing, whether they be local or out of state. Families who make less than 50% of the average income also may qualify for certain housing subsidies as well, but it’s not a given that they will receive anything. Once this 50% threshold is reached, however, the family may apply for some form of low income housing, which may come in the form of subsidies from the government to supplement rent payments, or, more holistically, placement in low income housing.
The more common form of holistic subsidized housing is called Affordable Housing. Affordable housing, or private low income housing, is any housing that receives incentives from the government to keep the rent for some or all of their rental units under a certain rate. These rates usually fall between 30% and 60% of the average rent for the area. While this may seem like a proper solution to the housing and income crisis in the United States, it actually makes the problem much worse.
Affordable Housing programs have several glaring issues, all of which stem from the profit-based motives that private businesses inherently have. Take, for example, the quality of affordable housing projects in America. They are routinely some of the worst options to live in. Due to the nature of privatized affordable housing, there’s a need to extract the highest amount of rent for the lowest amount of upkeep. Even Not-for-profits run into this issue, as operating costs must be kept at the lowest possible level, while rents must be high enough to pay staff and the owners of said Not-For-Profit, who often have high salaries despite the nature of their companies.
Regulations put in place on Affordable Housing can affect the housing quality as well. While having regulations on the practices of building and maintaining Affordable housing would seem to foster better quality, they are, in effect, nonsensical. Due to many Affordable housing options requiring management companies to hold all budgetary funds in escrow at the beginning of the year, many budgets fail to reflect the actual needs of the community, and again, due to profit motives and the way Affordable Housing projects are funded, there is a tendency to vastly under-budget.
There is a rot that runs to the core of Affordable housing. The housing projects are often Low Income Housing Tax Credit, or LIHTC housing, which fuels sinister practices. Syndicators, or professional property investors, will fund a housing developer’s project to build housing. These syndicators retain a very large share of the real property ownership, while forgoing the rent to the management company, who runs the property. This is to create a situation where the syndicators can write off massive depreciation from the property over many years, while not having to pay taxes on the collected rent.
Public housing works in a very similar way to Affordable Housing, with the only difference being that the department of Housing and Urban Development, or HUD, owns the property. While this is closer to the ideal, it runs into even worse issues than affordable housing. Funding for HUD housing is almost non-existent, as it’s meant to run as a cost-neutral service. Due to the general push towards privatization, going into full force with Ronald Reagan’s housing policies, HUD has become a dilapidated, sad agency without any resources to sustain itself in a proper way.
Those are the main issues when HUD owns and manages housing, but there are an amalgam of issues when that management is private. There are situations where HUD will contract their management of properties to private management companies. This replicates many of the same profit-driven behavior that is seen in affordable housing. The management company has to make a profit, and the grants given out only do so much to satiate the hunger for more capital.
Another, unspoken issue about both instances of low income housing is that they require time to obtain the actual housing. Some waitlists are years long, as very few people have the ability to actually leave low income housing once they end up there. The average time spent in low income housing is slightly over ten years. These waitlists are also held up in part by the absolutely abysmal conditions some of the housing available is in. Roughly 2-3% of available low income housing is vacant, which can be attributed to either condition or location. It’s a simple case of the available housing is either near nothing useful, meaning there are no jobs for the families who would live there, or the housing is so dilapidated that living there would put the family at risk. It’s common for these low income housing to be made out of glorified plastic and paper, instead of proper building materials, which is both low in quality and requires constant replacement, a cost that is often shuffled onto the tenant.
These issues arise because housing in America is not considered a fundamental right. Public housing is a service, much like the postal service. The view on these services that are almost certain to run a deficit is that they’re broken because of this. These costs on society are beneficial, however, as they can be compensated by other resources within a state, and provide an unrivaled increase in living standards.
There is no real way for those who are in low income housing to pull themselves out of that situation. If a family begins to make more money than the qualifying amount, they risk losing their housing, and entering the market rate housing paradigm is extremely taxing on families with depressed incomes. Low income housing works as a type of income trap, much like disability payments, where you may only make a certain amount of income yearly or you no longer qualify for the housing’s lower rent/subsidies.
This would all be solved, however, with fully socialized public housing for all of those who need it. If the state were to provide housing with the understanding that it will run at a resource deficit, and that that deficit is necessary, many of the ailments of public housing would be fixed. Of course, when profit incentives are introduced to the situation, everything becomes an issue of cost. It should be seen as something worth spending the excess on. Resources don’t have to be hoarded in this way, where we build mansions and office buildings that could sit empty without disrupting even the capitalist economy. Instead, under a proletarian-ran system, housing would be recognized as a service and a right, not just a necessity to life that’s limited to the economically well off.