Consumer Law

The housing market mess; connecting some dots

By Nick Slade

It is getting time for a complete overhaul of the whole housing market in the US, rather than just messing with edges. Two different stories in the Minneapolis StarTribune this morning illustrate why.

First is the story about all the people applying for Section 8 assistance. Recently about 3,700 people took applications, for one of the 300 voucher to be drawn in a waiting list lottery for housing in Plymouth.

The turnout is a sign of a growing metro-area problem: a shortage of affordable housing. In fact, experts had predicted it. Each time a housing authority opens its Section 8 wait list, applicants overwhelm it.

Experts and housing advocates say the long lines point to a larger crisis in affordable housing: Paychecks have not kept pace with housing costs, and the supply of affordable housing pales in the face of growing demand. In 2006, one in eight Minnesota households was paying half of its income on housing, according to a census analysis by Minnesota Housing Finance Agency. That’s up from one in 15 in 2000. Renters in Minnesota are worse off. In 2006, nearly one in four renters was paying half her income on housing.

Second, we have a story about the trouble and costs of vacant foreclosed houses in the City of Minneapolis. The number of boarded properties has swollen from about 250 in 2005 to more than 800 now.

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Full post as published by Caveat Emptor on February 21, 2008 (boomark / email).