The myth of the one dollar house: Differential drivers of cost burden in growing and shrinking U.S. places

Authors: Eric Seymour*, Brown University, K Arthur Endsley, University of Michigan, Rachel Franklin, Newcastle University
Topics: Population Geography, Urban and Regional Planning
Keywords: population loss, housing, cost burden
Session Type: Paper
Day: 4/5/2019
Start / End Time: 3:05 PM / 4:45 PM
Room: Council Room, Omni, West
Presentation File: No File Uploaded

Housing affordability crises in destination cities like New York, Los Angeles, and San Francisco have gained increasing attention as an influx of skilled workers has dramatically increased demand for housing, pushing rent increases far beyond wage growth for incumbent residents. Legacy cities losing population, in contrast, are often characterized as rich in low-cost housing, providing an affordable alternative to superstar cities and their astronomically priced units. As places lose population, so too do they lose demand for housing, lowering rents and home prices. Selective outmigration, however, often means places losing population retain a large share of low-income households, for whom ostensibly low-cost housing can be unaffordable. Further, rent cannot fall below a certain threshold, as landlords have fixed housing costs. Inadequate demand in these cases often leads to abandonment, not less-costly housing. The relationship between population loss, decline and abandonment has been studied extensively in recent years, but there has been little work on the housing costs of remaining households. This research addresses this deficiency by examining trends in housing cost burden at multiple scales between 2000 and 2016 and the separate mechanisms exacerbating cost burden in growing places, where rents are likely rising faster than income, and shrinking places, where incomes are falling faster than rent. A better understanding of the geographically heterogeneous drivers of uniformly high cost burden in the U.S. can inform locally tailored policy to tackle this crisis.

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