WORST CASE

2025 REPORT TO CONGRESS HOUSING NEEDS

U.S. Department of Housing and Urban Development | Office of Policy Development and Research

Worst Case

Housing Needs

2025 Report to Congress

Prepared for

U.S. Department of Housing and Urban Development

Office of Policy Development and Research

July 2025

Foreword

The U.S. Department of Housing and Urban Development (HUD) is pleased to transmit to the U.S. Congress its 20th report on Worst Case Housing Needs. This biennial report provides data on and analysis of critical problems facing low-income renting families. It primarily draws on research from the 2023 American Housing Survey (AHS), which is funded by HUD and conducted by the U.S. Census Bureau. The AHS has taken place every 2 years since 1973, and it remains a vital source of national data on housing markets, conditions, and dynamics.

Renter households with worst case housing needs are defined as those with very low incomes who do not receive government housing assistance and pay more than one-half of their incomes toward rent, those who live in severely inadequate conditions, or both. During the 2019-to-2021 period, which covered the COVID-19 pandemic, increasing household growth, increasing interest rates limiting homeownership, falling incomes, and increases in rent led to a sharp increase in cases of worst case needs—a record high of 8.53 million cases. Between 2021 and 2023, cases of worst case needs remained elevated at 8.46 million households, virtually the same as the 2019-to-2021 period.

One key cause of elevated worst case needs is immigration. Between 2021 and 2024, the foreign-born population of the United States increased by more than 6 million—the largest such increase over such a short period in American history. The foreign-born population now stands at more than 53 million individuals, making up the highest share of the American population in history. This immigration-driven increase in households has contributed to a significant increase in housing demand, thus driving up housing prices. In fact, in some markets, immigration has accounted for nearly all of the increase in housing demand in recent years.

This year’s report shows two realities. The first is that economic growth has been insufficient to lift the wages of low-income renting families high enough to make rent affordable. The second is that national macroeconomic policies, such as record immigration, have combined to drive sustained high rental demand, which has continued to place upward pressure on rent prices.

As a result, in 2023, only 59 affordable units were available per 100 very low-income renter households, and only 38 units were available per 100 extremely low-income renter households. Worst case needs were common in every region and metropolitan category across the nation but most prevalent in the West, the South, and urban suburbs.

Contrary to popular narratives, America has more housing units per capita than almost any time in history, and 2024 saw a record amount of rental housing supply brought onto the market. This suggests that the housing crisis may be less one of a shortage of supply, and more a crisis of the supply being more expensive than what the average American can afford. Because the supply of housing is much less elastic than demand, moderating demand may be a more effective policy option than very worthwhile efforts to increase supply.

We hope that policymakers, practitioners, researchers, and the public will find this report informative and compelling. We are eager to move forward with common purpose to address this great challenge.

John Gibbs

Principal Deputy Assistant Secretary for the Office of Policy Development and Research U.S. Department of Housing and Urban Development

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS iii

Contents

Executive Summary .......................................................................................... vi

WORST CASE NEEDS REMAIN UNCHANGED FROM THE RECORD HIGH OF 2021

....................................................................................................................... VII

PREVALENCE OF WORST CASE NEEDS ACROSS DEMOGRAPHIC GROUPS AND

HOUSEHOLD TYPES ...................................................................................... VIII

DEMOGRAPHIC AND MARKET FACTORS SHAPE THE PERSISTENT SHORTAGE OF

AFFORDABLE AND AVAILABLE RENTAL HOUSING ........................................ IX

CONCLUSION................................................................................................. XIII

Section 1. Extent and Nature of Worst Case Needs ........................................ 1

THE EXTENT OF WORST CASE NEEDS IN 2023 ................................................ 1

INADEQUATE INCOME AND INADEQUATE HOUSING ........................................ 3

PREVALENCE OF WORST CASE NEEDS BY INCOME ......................................... 5

WORST CASE NEEDS PREVALENCE AMONG U.S. HOUSEHOLDS ..................... 5

DEMOGRAPHICS OF WORST CASE NEEDS ....................................................... 6

WORST CASE NEEDS BY RACE AND ETHNICITY .............................................. 6

WORST CASE NEEDS BY HOUSEHOLD TYPE ................................................. 11

HOUSEHOLDS THAT INCLUDE PEOPLE WITH DISABILITIES ........................... 15

OVERCROWDING AND WORST CASE NEEDS .................................................. 17

SUMMARY ....................................................................................................... 19

Section 2. The State of Affordable Housing ................................................... 21

GEOGRAPHY OF WORST CASE NEEDS ........................................................... 21

WORST CASE NEEDS AND HOUSING ASSISTANCE BY REGION AND

METROPOLITAN LOCATION ........................................................................... 21

VARIATION IN WORST CASE NEEDS BETWEEN METROPOLITAN MARKETS... 26

FACTORS LIMITING ACCESS TO AFFORDABLE RENTAL HOUSING ............... 29

UNPRECEDENTED IMMIGRATION ................................................................... 29

ADVERSE IMPACT OF DEMAND-SIDE HOUSING SUBSIDIES ............................ 30

MARRIAGE DECLINE ..................................................................................... 30

HOW THE MARKET ALLOCATES AFFORDABLE HOUSING ON A NATIONAL

BASIS ............................................................................................................ 31

AFFORDABILITY, AVAILABILITY, AND ADEQUACY OF THE NATIONAL RENTAL

STOCK .......................................................................................................... 33

RENTAL STOCK BY INCOME .......................................................................... 36

GEOGRAPHY OF SUPPLY ................................................................................. 37

iv WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

RENTAL STOCK BY REGION .......................................................................... 37

RENTAL STOCK BY METROPOLITAN LOCATION ............................................ 38

SUMMARY ....................................................................................................... 40

Section 3. Understanding the Trend in Worst Case Needs .......................... 42

DRIVERS OF AFFORDABLE HOUSING DEMAND .............................................. 42

OTHER FACTORS AFFECTING AFFORDABLE HOUSING SUPPLY AND DEMAND45

CONCLUDING SUMMARY ................................................................................ 49

Appendix A. Detailed Data on Housing Problems and Supply of Affordable

Housing .............................................................................................................. 50

Appendix B. Supplemental Exhibits ............................................................... 93

Appendix C. Federal Housing Assistance and Affordable Housing Programs

............................................................................................................................ 96

Appendix D. Previous Reports to Congress on Worst Case Needs.............. 97

Appendix E. Data and Methodology .............................................................. 98

USING THE AMERICAN HOUSING SURVEY DATA ........................................... 98

HOUSEHOLD AND FAMILY TYPES ................................................................ 100

HOUSING ASSISTANCE STATUS .................................................................... 100

HOUSING PROBLEMS .................................................................................... 101

INCOME MEASUREMENT .............................................................................. 102

INCOME CATEGORIES .................................................................................. 102

LOCATION ..................................................................................................... 104

MISMATCH OF SUPPLY AND DEMAND FOR AFFORDABLE RENTAL HOUSING104

RACE AND ETHNICITY .................................................................................. 106

SHIFT-SHARE DECOMPOSITION ................................................................... 106

Literature Cited .............................................................................................. 108

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS v Executive Summary

Worst case need is a longstanding measure of the extent of unmet needs for affordable rental housing of adequate quality, tracked since 1978. Housing affordability is primarily made possible through housing offered in the private market at affordable rents, increases in income caused by robust economic growth, or a combination of the two. Renter households are defined as having worst case needs for such housing if they have very low incomes—household incomes at or below 50 percent of the Area Median Income (AMI)—do not receive government housing assistance, and either pay more than one-half of their income for rent, or live in severely

inadequate conditions, or both.1

Worst Case Housing Needs: 2025 Report to Congress examines trends in and causes of worst

case needs using the most recent data from the 2023 American Housing Survey (AHS).2 This report finds that in 2023, worst case housing needs essentially remain at the all-time high level of 8.5 million households reached in 2021. The number of households with worst case needs has averaged 8 million since the 2007–09 Great Recession, well above the previous average of 5 million households. The unmet need for decent and safe housing that the average American can afford continues to outpace income growth and the ability of federal, state, and local governments to moderate the persistent rise in housing costs.

Contrary to popular belief, America is producing record amounts of housing supply. The year 2024 saw 591,600 new apartments added to the rental market, the highest number since the early

1970s.3 From 2000 to 2020, housing production exceeded the growth of households by 3.3

million units.4 In 2024, the number of housing units per capita was the highest ever measured.5 This suggests two things. The first is that the housing crisis lies not solely in a lack of supply, but rather in prices that are too high for Americans to afford, and in an uneven distribution of supply. The second is that excessive demand is a key driver of the housing crisis. Government policies such as large-scale immigration, housing subsidies which may raise demand more than supply can keep up, loose monetary policy which may drive up house prices and keep more people renters, and sociological phenomenon such as continually declining marriage rates—which increases the number of households and thus demand—all combine to drive up demand faster than the increasing supply of housing can keep up, thus creating a challenging picture for rental affordability.

—————————————————————————————————————— 1 Worst case needs estimates, like U.S. Department of Housing and Urban Development (HUD) programs, use AMI based on local family incomes with adjustments for household size, precisely known as HUD Area Median Family Income, or HAMFI (see the discussion of income categories in appendix E). 2 Unless otherwise cited, estimates presented in this report are the findings of HUD’s analysis of worst case needs and related factors using AHS. The U.S. Census Bureau reviewed this data product for unauthorized disclosure of confidential information and approved the disclosure avoidance practices applied to this release. CBDRB‑FY24‑0483. 3 U.S. Census Bureau, Survey of Construction.

4 U.S. Census Bureau, Survey of Construction and Decennial Census. 5 Based on analysis of Decennial Census and Census of Housing, U.S. Census Bureau, 1940 to 2024. In 1939 the Census Bureau was authorized to obtain data on the characteristics of the Nation’s housing supply and occupancy via the 1940 census (Devaney, 1994).

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS vi Worst Case Needs Remain Unchanged From the Record High of 2021

There were 8.46 million renter households with worst case needs in 2023, an insignificant decrease of 62,000 cases compared with 8.53 million in 2021, which had topped even the recession-driven record of 8.48 million in 2011. The number of very low-income (VLI) renters with worst case housing needs averaged 8 million in the past decade (exhibit ES-1), a major increase from the years preceding the 2007–09 recession, when macroeconomic factors were less adverse to housing affordability.

The number of VLI renters who experience worst case needs has increased in recent years. In 2023, however, the overall number of households with very low incomes marginally decreased by 1.0 percent, and the number of households with worst case needs minimally decreased by 0.7 percent. Despite these decreases, the percentage of VLI renters experiencing worst case needs (the “prevalence” of worst case needs) was 44.2 percent in 2023, slightly higher than the record prevalence of 44.1 percent observed in 2021.

VLI renter households comprise two income groups: households with extremely low incomes

(ELIs) and households with incomes between 30 and 50 percent of AMI.6 ELI renter households account for the majority of worst case needs cases: 68.6 percent in 2023, down from 71.0 percent in 2021. The prevalence of worst case needs decreased among ELI renters between 2021 and 2023 but increased among renters with incomes between 30 and 50 percent of AMI, as might occur if ELI renters with worst case needs increased incomes sufficiently to move into the 30–50 percent of AMI group without substantially improving their housing cost burdens.

Exhibit ES-1. Change in Worst Case Housing Needs, 2013–23

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

—————————————————————————————————————— 6 HUD calculates Area Median Family Incomes annually for all metropolitan areas and each nonmetropolitan county in

HUD’s income limits. More information can be found at https://www.huduser.gov/portal/datasets/il.html.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS vii

Prevalence of Worst Case Needs Across Demographic Groups and Household Types

The percentage of VLI renters experiencing worst case needs varied among demographic groups. In 2023, the prevalence of worst case needs was 55.1 percent among Asian households, 48.0 percent among Hispanic households, 45.0 percent among non-Hispanic White households, and 38.1 percent among non-Hispanic Black households. Between 2021 and 2023, the prevalence of VLI renters with severe problems increased by 2.5 percentage points for Asian households, 1.0

point for non-Hispanic White households, and 0.6 point for Hispanic households.7 The prevalence of VLI renters with severe problems decreased by 1.2 percentage points for non-Hispanic Black households and by 12.0 points for other races or ethnicities. The percentage of VLI renters receiving rental assistance increased for most race and ethnic groups but remained the same for Asian households between 2021 and 2023.

About 8.5 million renter households had worst case needs in 2023, of whom 3.17 million lived in the South, 2.29 million lived in the West, 1.48 million lived in the Northeast, and 1.53 million lived in the Midwest. Since 2021, prevalence has increased by more than 3 percentage points in the West and has decreased to a similar amount in the Northeast, but the South and Midwest saw smaller changes. Nonmetropolitan areas also saw a prevalence increase of more than 2 points.

For VLI renters, worst case needs remained a serious problem among all household types in 2023. The prevalence of worst case needs was 42.9 percent among families with children, 38.8 percent among households headed by older adults without children, 52.2 percent among “other family” households (including multiple family members without children), and 49.2 percent among “other nonfamily” households (mostly single individuals). Between 2021 and 2023, the prevalence of worst case needs increased by 3.2 percentage points among nonfamily households and 2.2 points among other family households and slightly decreased by 1.5 points among families with children and 1.3 points among households headed by older adults.

Marriage dramatically increases homeownership and upward mobility, providing a path for married couples to escape VLI status and thus worst case needs. Because married couples are far more likely to be homeowners than others, married couples have a much lower prevalence of worst case needs than other households when measured as a percentage of all households. Measured across all tenure and income categories, worst case needs afflict just 3.8 percent of married-couple households compared to 11.9 percent of other households. Among married-couple households, 90.3 percent of older adults, 76.2 percent of families with children, and 76.1 percent of other families are homeowners, much higher than the corresponding rates for non-married couples.

In absolute terms, worst case needs have increased among all household types since 2019. In 2023, households with worst case needs included 2.46 million older adult households, 2.33 million families with children, 0.87 million “other family” households, and 2.80 million “other nonfamily” households. About one in seven renter households with worst case needs—13.7 percent, or 1.16 million—included people younger than 62 who have disabilities.

—————————————————————————————————————— 7 “Severe problems” means the household has either a severe rent burden (paying more than 50 percent of its income for rent and utilities) or severely inadequate housing (having one or more serious physical problems related to heating, plumbing, and electrical systems or maintenance).

viii WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Overcrowding is defined as the condition of having more than one person per room in a residence, considering only whole rooms such as bedrooms, living rooms, dining rooms, kitchens, recreation rooms, lodger’s rooms, and other finished rooms. In 2023, about 797,000 VLI renter households, or 4.2 percent, were overcrowded. Of these, 365,000 households also

experienced worst case needs.8 More than two-fifths of VLI renter households experiencing overcrowding also experienced worst case needs. The large majority—81.9 percent—of VLI renters with overcrowding had moderate or severe rent burden. Most VLI households with overcrowding—94.5 percent—were families with children. More than three-fifths of overcrowded households in 2023—60.5 percent—were Hispanic, 17.1 percent were non-Hispanic White, 13.3 percent were non-Hispanic Black, 7.2 percent were Asian, and 2.1 percent were of other races and ethnicities. The majority of overcrowded households in 2023—82.4 percent—had more than four household members.

Demographic and Market Factors Shape the Persistent Shortage of Affordable and Available Rental Housing

For most households, worst case needs are caused by severe rent burdens—that is, paying more than one-half of the household’s income for rent. Inadequate market supply, competition for affordable units, and a lack of growth in their incomes continued to pose substantial challenges for VLI renter households in 2023. Inadequate housing quality caused only 2.0 percent of worst case needs.

The net decrease in worst case needs by 62,000 cases between 2021 and 2023 is attributable to a combination of the demographic changes affecting the number of unassisted VLI renter households and the housing market’s response to affordable housing demand. Exhibit ES-2 shows how these factors worked together to produce the statistically insignificant decrease. An attribution analysis estimated the independent contribution of each of four increasingly focused demographic factors to assess its effect on the number of unassisted VLI renters and, thereby, on the number of worst case needs. The positive or negative effects attributed to the four demographic factors are represented by the first four bars of exhibit ES-2: household formation increased worst case needs because there was a net increase in new households from population changes, due in part to large increases in immigration in recent years; tenure shift reduced worst case needs because the growth in renters between 2021 and 2023 lagged behind the growth in homeowners; renter household income shifts decreased worst case needs because there was a net decrease of renter households with income below 50 percent of AMI; and the rental assistance

gap may have9 decreased worst case needs because there was a small increase in VLI renters receiving rent subsidies from the federal, state, or local government.

—————————————————————————————————————— 8 HUD categorizes overcrowding as a moderate housing problem rather than a severe problem, so households that experience overcrowding but do not experience severe rent burden or severely inadequate conditions are not included in the count of households with worst case needs.

9 Because the availability of rental subsidies can increase demand for the same affordable units in some markets, households not receiving a subsidy may face higher rents due to rental subsidies. This means that rental subsidies may inadvertently create additional worst case needs households.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS ix

Exhibit ES-2. Factors Affecting Change in Worst Case Needs, 2021–23

VLI = very low-income.

Note: The columns of exhibit ES-2 are cascading in the sense that each column begins where the previous one ends, and the final column displays the net effect on worst case needs. Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

The demographic factor that kept worst case needs near the record level of 2021 was household formation—individuals creating new single-person or multiperson households in a separate housing unit. Although an increase in household formation occurred in all groups—citizens by birth, naturalized citizens, and non-citizens— the share of household growth attributable to non-citizens increased substantially in recent years, whereas the share attributable to U.S.-born

x WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

citizens decreased.1011 The factors that tended to decrease worst case needs most were the increase in homeownership rates (by definition, only renters can have worst case needs), increases in income among VLI renters, and the reduction in the gap between the number of households eligible to receive housing assistance and the number who receive it. The four demographic factors combined to create a potentially significant net decrease in worst case needs of 258,000 between 2021 and 2023 by decreasing the size of the unassisted VLI renter population, but housing market dynamics largely offset it, represented by the fifth bar of exhibit

ES-2.12 An increase in prevalence associated with market dynamics aggravated worst case needs by an estimated 196,000 households through 2023, shrinking the net decrease to 62,000. The modest pace of additions to the rental stock relative to increases in renter households was insufficient to meet the high demand for affordable VLI units. If the supply of affordable rental units fails to increase at the same rate as the renter population, greater demand would be expected to increase competition for affordable units, drive up rents, and increase the prevalence of worst case needs.

Housing market dynamics are the various factors that determine the prevalence of worst case needs among unassisted VLI renters by shaping occupancy and rents. VLI renters compete among themselves and with renters of higher incomes for more affordable units with good quality and amenities. Critical supply factors in the housing market include the amount of housing stock and the cost of financing, operating, and maintaining rental developments. As a result, the affordability of homebuying in the third quarter of 2023 reached its lowest point since

the National Association of REALTORS® initiated the Housing Affordability Index.13 This means that renters hoping to purchase a home are unable to afford to do so. They instead remain renters, furthering constraining the supply of available rental units. Such market dynamics constrain the availability of affordable rental units to households with very low incomes and thereby determine the prevalence of severe cost burdens.

The national trend in the availability of affordable rental units between 2021 and 2023 was in some ways positive. The VLI renter population decreased by 198,000 households, whereas the rental units affordable and available to them increased by 278,000. ELI renters decreased by 302,000 households, whereas the supply of affordable and available units for these renters increased by 138,000. However, these numerical changes were modest and did not consider the disruption of inflation on prices for basic needs. The affordable unit measure used in this report considers current income not adjusted for inflation, perhaps overestimating the number of units affordable to VLI and ELI households. Rents for mid-range units increased at a lower rate than renter incomes between 2021 and 2023. Median renter housing costs increased by 17.5 percent, behind the 20.8 percent increase in the median renter income (exhibit 3-2). For VLI renters as a

—————————————————————————————————————— 10 Between March 2022 to March 2024, the foreign-born population increased by 5.1 million, the largest two-year increase ever in American history. The foreign-born population has grown by 20 million since the year 2000, a 40% increase, causing significant increases in housing demand and housing prices. 11 The share of household growth between 2019 and 2023 attributable to non-citizens was 13 percent, nearly double the 7-percent share that non-citizens contributed to household growth from 2015 to 2019. The share of household growth between 2019 and 2023 attributable to U.S.-born citizens was 73 percent for the 2019-to-2023 time period, compared to 82 percent between 2015 and 2019.

12 One limitation of decomposing factors affecting worst case needs is that local rather than national housing markets determine rents. Appendix E provides additional detail about the shift-share decomposition approach and its limitations.

13 See https://www.huduser.gov/portal/sites/default/files/pdf/NationalSummary_1Q24.pdf.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS xi group, however, the mean rent increased by 17.0 percent between 2021 and 2023, whereas the mean income increased by only 12.6 percent (exhibit A-14), explaining why the prevalence of severe rent burdens increased.

Access of VLI renter households to a sufficient supply of naturally affordable rental units or assisted units is critical to the extent of the worst case needs problem. Exhibit ES-3 presents how the availability of rental units affordable to VLI households has responded to demand trends during the past 10 years.

Exhibit ES-3. Trends in Housing Supply Mismatch and Worst Case Needs, 2013–23

ELI = extremely low-income. VLI = very low-income.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Although the supply of rental units slightly expanded in 2023, rental housing production has significantly lagged behind household formation since 2010. At the same time, the number of households receiving rental assistance has risen only modestly and has not kept pace with the increase in the number of VLI households. Rental units added to the stock have tended to be in higher-rent properties. As a result, the ratio of affordable and available units to VLI renters followed a downward path from 2009 to 2017. From 2017 to 2019, the ratio modestly improved to later worsen again between 2019 and 2021. The ratio moderately improved to 59 units per 100 renter households in 2023 from 57 units per 100 renter households in 2021. For ELI households, the ratio increased from 36 to 38 affordable and available units per 100 households in 2023. While incentivizing an increase in the supply of housing that is affordable to households across the income spectrum is critical for reducing worst case needs, moderating demand factors that

xii WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS exacerbate the crisis, such as large-scale immigration, loose monetary policy, and subsidies that may drive demand faster than supply can keep up, is perhaps even more critical.

Among VLI renters with access to affordable housing, a large share have such access by virtue of the rental assistance they receive. However, research suggests that the increased demand created by rental assistance may cause an increase in rent prices in some market segments, which reduces affordability for VLI renters not receiving rental assistance (Susin, 2002). Availability ratios compared with affordability ratios also make clear the intense competition for the most affordable housing. For each affordability bracket, renters with incomes above the bracket levels occupy large shares of units affordable to households within the bracket. Such crowding-out affects 42 percent of the units affordable to ELI renters, 43 percent of the units affordable at incomes of 30 to 50 percent of AMI, and 36 percent of the units affordable at incomes of 50 to 80 percent of AMI. When higher-income renters defer home purchases, they continue to compete for affordable units and sustain rental demand, limiting the availability of affordable rental units for lower-income renters by nearly two-fifths. Indeed, occupying more modest housing units than might be afforded can be quite prudent if households expect that recent income gains might be temporary. In short, the effects of weak growth in the rental housing supply, household income growth not keeping pace with rents, and strong competition for available rental units from higher-income renters seem to be having a detrimental effect on the availability of units affordable to renters with incomes at and below 50 percent of AMI. Improving the availability of affordable rental units for households with precarious incomes will be crucial to reducing worst case needs.

Conclusion

Worst case housing needs presented a small and statistically insignificant decrease between 2021 and 2023. This period was a time of economic recovery from the pandemic disruptions that marked 2020 to 2022. By comparison, household incomes moderately increased, the homeownership rate increased, and the housing assistance rate slightly increased during the preceding period. All these factors combined to prevent worst case needs from increasing beyond their record 2021 level. Although housing production did occur, its quantity and affordability were not sufficient to reduce worst case needs significantly. Demand-side factors which worsen housing affordability also saw few changes that would reduce worst case needs.

The subtle change between 2021 and 2023 of VLI renters with severe housing problems is attributable to demographic factors. The demographic factors preventing an exacerbation in worst case needs cases were income gains, households purchasing homes instead of renting them, and the narrowing gap between renter households eligible to receive housing assistance and those receiving it. Although the supply response to demand slightly improved to increase the availability of affordable units, it was insufficient to alleviate the persistent shortage of affordable units to decrease the prevalence of worst case needs significantly. The weak supply response of the housing market continues to create serious problems for VLI renters as rents continue to increase at a faster pace than incomes, resulting in an increased prevalence rate. Despite improvement in incomes for VLI households during 2021–23, households faced higher inflation rates during the same period, possibly resulting in an overestimation of affordable units for VLI households. More than three in five ELI renter households and about three in seven VLI renter households continued to lack access to affordable and available housing units as of 2023.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS xiii While rental housing assistance—such as that offered by HUD programs, other federal programs, states, or localities—may help many vulnerable renter households that have such limited incomes, it may harm vulnerable renter households that do not receive rental assistance because it may drive up rents in some market segments through the extra demand created by the rental assistance. Although among VLI renters in 2023, 28.0 percent of households were able to avoid worst case needs because they had rental assistance, further research is needed to determine the quantity of new households with worst case needs that may be created by the demand-driven effects of rental assistance in certain markets. About one in four eligible VLI renter households receive rental assistance. Another 27.7 percent of VLI renters were able to avoid severe housing problems in the unassisted private rental market by finding affordable units of adequate quality. However, the remaining 44.2 percent were left with worst case needs, and almost five in seven of those were ELI households. Worst case needs impact families of all types, in all regions of the country, and in rural, suburban, and urban areas. Households in all race and ethnicity groups and all household types experienced worst case needs.

A broad strategy at the federal, state, and local levels has long been needed to continue to grow the economy, support market production and access to affordable homes, and reduce demand-side factors that place continual upward pressure on housing prices. Worst case housing needs remain near the record levels reached during the COVID-19 pandemic and are likely to improve substantially with only a comprehensive approach to addressing the affordable housing crisis.

xiv WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Section 1. Extent and Nature of Worst Case Needs

HUD is the largest federal provider of affordable rental housing. In response to a request by the U.S. Congress in 1991, HUD’s Office of Policy Development and Research (PD&R) periodically reports on the severity of worst case needs for affordable rental housing, using data collected in the biennial American Housing Survey (AHS). This report is the 20th in the series of

core reports.14 This report measures worst case housing needs as of mid-2023 after the COVID-19 pandemic ended and economic growth returned, along with significant price inflation.

Which Households Can Have Worst Case Needs?

By definition, households that can have worst case needs are households that— • Are renters.

• Have very low incomes—that is, incomes of no more than 50 percent of the Area Median

Income (as adjusted for family size).

• Do not receive housing assistance.

Severe Problems Trigger Worst Case Needs

Two types of severe problems determine whether households have worst case needs: 1. Severe rent burden, which means that a renter household is paying more than one-half of its

income for gross rent (rent and utilities).

2. Severely inadequate housing, which refers to units having one or more serious physical

problems related to heating, plumbing, and electrical systems or maintenance (problems are listed in appendix E).

The Extent of Worst Case Needs in 2023

HUD analysts examined the 2023 AHS data to understand the evolving dimensions of the large and growing shortage of decent and affordable rental housing for lower-income households. The basic facts presented and examined in the following pages are—

• In 2023, 8.46 million renter households had worst case needs (exhibit 1-1). These renters

have very low incomes,15 lack housing assistance, and either have severe rent burdens or severely inadequate housing (or both).

• Between 2021 and 2023, the number of very low-income (VLI) renters with worst case

needs decreased by less than 1 percent. The new estimate of 8.46 million households with worst case needs is insignificantly below the 2021 estimate, which was the highest level observed in the past 20 years. The number of households experiencing worst case needs has increased 10.4 percent since 2013, when the number of worst case needs was 7.72

—————————————————————————————————————— 14 PD&R supplements the core reports on worst case needs with periodic topical reports. For a list of previous titles, see appendix D.

15 Very low income (VLI) and extremely low income (ELI) refer throughout this report to the income levels of renters. VLIs are incomes of no more than 50 percent of the Area Median Income (AMI), and ELIs are those of no more than 30 percent of AMI. Worst case needs estimates, like HUD programs, use AMI based on local family incomes with adjustments for household size, precisely known as HUD Area Median Family Income, or HAMFI

(see the discussion of income categories in appendix E and HUD’s income limits web page). In 2023, the median renter was classified with respect to a family-size-adjusted VLI limit of $39,900 and an ELI limit of $24,860 (see exhibit 3-2). ELI and VLI families may have substantially lower incomes if they have fewer than four members or live in areas with lower median family incomes or substantially greater incomes if they live in the highest-cost metropolitan areas.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 1

million households. The number of renters with worst case needs has averaged 8.08 million households since 2013.

• The 62,000 reduction in cases of worst case needs since 2021 reflects 181,000 new cases

among renters with incomes between 30 and 50 percent of Area Median Income (AMI) and 243,000 fewer cases among renters with extremely low incomes (ELIs). ELI renter households account for the majority—68.6 percent—of worst case needs in 2023, which is their lowest share of these problems observed since 2001.

• Consistent with long-term trends, the primary problem for worst case needs renters in

2023 was severe rent burden resulting from insufficient income relative to rent. Severely inadequate housing accounted for only 2.0 percent of worst case needs.

• Negative demographic and economic forces prevented worst case needs from subsiding

between 2021 and 2023. Competition for affordable units slightly decreased, and not many households moved toward homeownership, erasing reductions in worst case needs since 2017.

• In 2023, VLI renter households totaled 19.14 million, a 1-percent decrease from 2021

levels, reversing the substantial increases seen in previous periods.16 In 2023, 44.2 percent of VLI renter households and 48.3 percent of ELI renter households had worst case needs.

• Although housing assistance may prevent some renters from experiencing worst case

needs, it may also indirectly create new worst case needs due to driving up rent prices in certain markets. The shortfall of housing assistance relative to need slightly improved between 2021 and 2023. Although the number of assisted, VLI renters increased by 4.3 percent between 2021 and 2023, rental assistance programs did not keep pace, resulting in a marginal increase by 1.4 percentage points in the share of VLI renter households receiving housing assistance. As of 2023, 28.0 percent of VLI renter households receive housing assistance.

• An important dimension of the affordable housing supply gap is that affordable units are

not necessarily available to the renters who need them most. Higher-income renters occupy substantial shares of units that would be affordable to the lowest-income renters. In 2023, only 38.4 percent of units were affordable and available to households with ELIs, and 58.8 percent of units were affordable and available to renters with very low

incomes.17

With these key facts in mind, this section explores the current extent and the demographic characteristics of worst case needs—which households have such needs and what their situations are.

—————————————————————————————————————— 16 Data collection for the 2023 AHS continued the standard practice of excluding one-time payments, such as federal stimulus payments, but including recurring payments, such as unemployment income, which might have been

temporarily boosted during the pandemic. See the definition of income at https://www2.census.gov/programs-

surveys/ahs/2021/2021%20AHS%20Definitions.pdf. 17 The definitions of affordability and availability are in the Mismatch of Supply and Demand for Affordable Rental Housing section in Appendix E. Data and Methodology.

2 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit 1-1. Change in Worst Case Housing Needs, 2013–23

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Inadequate Income and Inadequate Housing

Of the two types of severe problems that make up worst case needs, severe rent burden is the more frequent problem by far. As exhibit 1-2 illustrates, 98.0 percent of all worst case needs renters, or 8.07 million households, had severe rent burdens in 2023. Paying one-half (or more) of a limited total income for rent leaves very little income for other essentials.

Exhibit 1-2. Characteristics of Worst Case Needs, 2023

N = 8.46 million renters with worst case needs.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 3 Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Severely inadequate housing alone caused only 2.0 percent of worst case needs in 2023, although 4.7 percent of renter households with worst case needs had severely inadequate housing, either alone or in combination with severe rent burdens. The number and share of worst case needs households experiencing severe housing quality problems remained almost unchanged between 2021 and 2023, decreasing by 87,000 households and 1 percentage point.

That severely inadequate housing causes such a small fraction of worst case needs is the result of a decades-long trend of improvements to the nation’s housing stock. More stringent building codes prevent the construction of units without complete plumbing or heating systems, and

obsolete units are demolished each year.18 In addition, some of the severe physical inadequacies reported in AHS result from maintenance or upgrade activity that affects the operation of key systems, such as plumbing, heat, or structural integrity, although units remain occupied. Among all renter households, 3.2 percent of those with very low incomes and 1.2 percent of those with

higher incomes had severely inadequate housing in 2023.19 Nevertheless, the housing stock is continually aging, and thousands of renters continue to live in severely inadequate units. The costs associated with repairing severe quality deficiencies present another formidable barrier to the ability of lower-income households to improve their housing conditions. Landlords offering lower-priced units for rent may similarly delay or avoid high maintenance and repair expenses as

units age.20

Progress in Reducing Homelessness

Individuals and families experiencing homelessness clearly have the greatest need for affordable or assisted housing. However, people experiencing homelessness are not included in official estimates of worst case needs because the American Housing Survey (AHS) covers only housing units and the households that live in them, and people experiencing homelessness, by definition, do not live in a housing unit and are not surveyed by AHS.a In its 2024 Annual Homeless Assessment Report to Congress: Part 1, HUD estimates that 771,480 people (563,136 households) were experiencing homelessness on a single night in January 2024, the highest ever recorded and up 18 percent since 2023. Most of these people, 64 percent, were staying in sheltered locations, such as emergency shelters and transitional housing programs. The remaining 36 percent were staying in unsheltered locations, such as parks, abandoned buildings, and cars (HUD, 2024).

Since 2007, when HUD first began collecting data nationally, total homelessness on a given night has increased by 19 percent, erasing a substantial period of long-term progress that saw total homelessness fall consistently, reaching a low of 549,928 in 2016. However, homelessness has been on the rise since 2016. From 2016 to 2020, a growing unsheltered population in high-cost

—————————————————————————————————————— 18 New construction and losses due to demolition and natural disasters primarily drive changes in the overall housing stock (Eggers and Moumen, 2016).

19 Homeowners reported severely inadequate housing at even lower rates than renters: 1.8 percent of VLI homeowners and 0.5 percent of homeowners with higher incomes had severely inadequate housing. See exhibit A-1B. 20 Divringi et al. (2019) estimated repair costs associated with quality deficiencies identified in the 2017 AHS and found that units occupied by renters with incomes at or below the poverty line accounted for $25.5 billion, or 56.7 percent, of the aggregate estimated repair costs associated with rental units in the United States. Older single-family and multifamily units occupied by poor renters had higher median repair cost estimates—$2,096 and $1,355, respectively—than newer units. Similarly, Wallace, Divringi, and Wardrip (2019) found that repair costs increase with the degree of housing inadequacy as measured by AHS, with median costs for repairing moderately and severely inadequate units estimated at $2,440 and $3,346, respectively.

4 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

markets, particularly in California and other western states, drove most of the increase. The number of people staying in unsheltered locations grew by 55 percent between 2016 and 2024. Between 2022 and 2024, sheltered homelessness started to increase rapidly, growing by more than 42 percent as housing costs increased across the nation. Between 2016 and 2024, the number of families with children experiencing homelessness increased by 33 percent, and individuals experiencing homelessness increased by 44 percent. Chronic homelessness among individuals grew by 97 percent even as the count of veterans experiencing homelessness decreased by 17 percent during the same period.

a AHS samples both occupied and vacant residential housing units but excludes places such as group quarters or motels where homeless persons may be sheltered (Census Bureau and HUD, 2024: 2).

Prevalence of Worst Case Needs by Income

Because severe rent burdens cause most cases of worst case needs, the adequacy of household incomes relative to rents of available units is crucial. Among the 19.14 million VLI renter households in 2023, nearly one-half, or 44.2 percent, had worst case needs (exhibit 1-3). The VLI category includes ELI renters, who had an even greater prevalence of worst case needs at 48.3 percent. That is, nearly one in two ELI households had a severe housing cost burden or lived in a severely inadequate unit, or both. ELI renter households constituted a large share (62.8 percent) of VLI renter households in 2023, yet their number decreased by 2.5 percent between 2021 and 2023, whereas renters with incomes 30–50 percent of AMI increased by 1.5 percent. With their greater numbers and greater prevalence of severe problems, ELI renter households accounted for the majority—68.6 percent—of worst case needs in 2023, slightly down from 71.0

percent in 2021 and their lowest share of worst case needs observed since 2001.21 Increased rates of severe problems among the 30–50-percent group more than offset improvements among ELI renters during 2021–23, as the prevalence rates in 2021 were 49.1 percent for ELI renters, 35.3 percent for the 30–50-percent group, and 44.1 percent for VLI renters overall.

Exhibit 1-3. Number and Prevalence of Worst Case Needs by Income Category, 2023

Category 0–30% AMI > 30–50% AMI Total VLI

VLI renters (thousands) 12,017 7,123 19,140

With worst case needs (thousands) 5,808 2,656 8,464

Percentage with worst case needs 48.3 37.3 44.2 AMI = Area Median Income (HUD-adjusted). VLI = very low-income. Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Worst Case Needs Prevalence Among U.S. Households

The estimated number of households with worst case needs decreased by 62,000 cases (or 0.7 percent) from 2021 to 2023. During the 10-year span from 2013 to 2023, the number of households with worst case needs had risen by 9.6 percent, or 743,000 households (exhibit 1-4), with the 2023 count remaining the highest estimate of worst case needs recorded in the aftermath

—————————————————————————————————————— 21 Of the 6.2 million ELI renter households without worst case needs, 4.3 million (or 69.0 percent) received rental assistance subsidized by HUD or other federal, state, or local programs. In other words, only 1.9 million of the 12.0 million ELI renter households nationally (or 16.0 percent) avoided severe housing problems in the unassisted private market in 2023. See exhibit A-1A.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 5

of the Great Recession in 2011.22 Worst case needs decreased as a proportion of U.S. households during the most recent 2-year period from 6.6 percent in 2021 to 6.4 percent in 2023.

Exhibit 1-4. Trends in Worst Case Needs Among All U.S. Households, 2013–23

Trends 2013 2015 2017 2019 2021 2023

All households (millions) 116.03 118.29 121.56 124.14 128.51 133.23

Renters with worst case needs (millions) 7.72 8.30 7.72 7.77 8.53 8.46

Worst case needs as percentage of all 6.65 7.02 6.35 6.26 6.63 6.35 households

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Because the problem of worst case needs is primarily one of a scarcity of units with affordable rents relative to the number of renters with very low incomes, the balance of section 1 examines the demographics of the renters who have those problems. Section 2 explores the dimensions of the inadequate supply of affordable rental units, and section 3 summarizes and integrates supply and demand issues to shed light on the root causes and shifting dimensions of this persistent national problem.

Demographics of Worst Case Needs

Worst case needs are an economic reality for many of the nation’s VLI renter households. The severe housing problems that trigger worst case needs are widespread for such households, yet notable variations exist among subgroups of the population.

Worst Case Needs by Race and Ethnicity

Worst case needs were found across all types of communities, racial groups, and ethnic lines. Both similarities and differences emerged when examining the four largest racial and ethnic groups: non-Hispanic White, non-Hispanic Black, Hispanic, and Asian. This section also examines detailed subgroups within the “other races and ethnicities” group to the extent

supported by the AHS sample size.23

In 2023, while non-Hispanic White renters accounted for the largest overall number of households with worst case needs (3.68 million) by race and ethnicity, they had the lowest occurrence of worst case needs relative to their share of the population. Non-Hispanic White renters, who make up 59 percent of the population, accounted for 43.5 percent of households with worst case needs, followed by Hispanic renters, who make up 19.6 percent of the population and accounted for 26.8 percent of worst case needs households. Non-Hispanic Black renters accounted for 13.7 percent of the population and 21.3 percent of worst case needs households,

—————————————————————————————————————— 22 Previous Worst Case Needs reports have documented much more rapid growth during the preceding 10 years. During 2003 to 2013, the number of worst case needs increased from 5.18 million to 7.72 million, an increase of 49 percent. 23 In this section, the race and ethnicity of households are based on the race and ethnicity of the householder as reported in the AHS data. Non-White people or non-White households refers to households that are not non-Hispanic White. “Other” is used in several ways. In the finest analysis that is consistently feasible with the AHS data, “other races and ethnicities” is the fifth of five main categories, comprising non-White households in subgroups not otherwise listed or in a combination of subgroups. In the more detailed breakout of exhibit 1-7, “Other race or ethnicity” has the same meaning but refers to a smaller residual category of households because the exhibit provides additional categories by breaking down the AHS data to the full extent feasible. Finally, some portions of the narrative use “other” in its plain sense of “ones not specified in the present context”—for example, when non-White groups are being compared with another non-White group.

6 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS and Asian renters, 7 percent of the population and 6.3 percent of worst case needs households. Renters of all other races and ethnicities were 2.2 percent of worst case needs households. Together, the four largest race and ethnicity groups accounted for 97.8 percent of worst case needs in 2023, and households headed by non-White people accounted for more than one-half— 56.5 percent—of worst case needs.

As exhibit 1-5 suggests, VLI renters do not experience worst case needs at a uniform rate. In 2023, worst case needs affected 55.1 percent of VLI renters among Asian households, a higher prevalence than 48.0 percent among Hispanic households, 45.0 percent among non-Hispanic White households, and 33.1 percent among the other race and ethnicity group. Prevalence was lower among non-Hispanic Black VLI households, with 38.1 percent having worst case needs. The lower prevalence of worst case needs among Black households reflects a greater likelihood

that Black VLI households receive housing assistance.24 Among non-Hispanic Black renters with very low incomes, 39.4 percent report housing assistance compared with only 24.8 percent of non-Hispanic White renters, 22.1 percent of Hispanic renters, 20.6 percent of Asian renters, and 42.1 percent of all other races and ethnicities (exhibits A-9 and A-1A). Among other factors contributing to this disparity, the geographic distribution of housing assistance plays a prominent role, as section 2 discusses.

Exhibit 1-5. Prevalence of Worst Case Needs by Racial and Ethnic Group, 2023

—————————————————————————————————————— 24 Although the prevalence of worst case needs among VLI renters is lower for non-Hispanic Black households than for other race and ethnicity groups, households with worst case needs represent a larger share of the overall non-Hispanic Black population than for other groups. Approximately 10.1 percent of all non-Hispanic Black households experience worst case needs compared with 4.3 percent of all non-Hispanic White households, 11.5 percent of all Hispanic households, and 7.5 percent of all Asian households.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 7 VLIR = very low-income renters.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Variation in rates of housing assistance among VLI renter households contributed to variation in the prevalence of worst case needs and the likelihood that households avoided severe housing

problems unassisted in the private market.25 Non-Hispanic White and Hispanic VLI renter households had the best odds of avoiding severe housing problems in the private market in 2023—30.1 percent of non-Hispanic White VLI renters and 29.9 percent of Hispanic VLI renters avoided severe problems without housing assistance. Only about one-fourth of Asian, non-Hispanic Black, and other VLI renter households—24.4, 22.5, and 25.0 percent, respectively— avoided severe problems in the private market without housing assistance.

The position of the markers in exhibit 1-5 reflects each racial/ethnic group’s share of VLI renter households and the rate at which they experience worst case needs. The vertical axis is the percentage of VLI renters for each group that experienced worst case needs in 2023. The horizontal axis is the share of all VLI renters that each group represents. Groups account for a greater share of worst case needs as their markers move toward the upper-right quadrant. The national worst case needs rate in 2023 of 44.2 percent is depicted by a horizontal dotted line. As a share of VLI renter households, the subgroups based on race and ethnicity spanned a range of 39.8 percentage points, but the prevalence of worst case needs varied by only 22.0 percentage points. Asian, the other races/ethnicities group, and Hispanic households are particularly more likely to have worst case needs than other subgroups, relative to their share of the VLI renter population. Other races or ethnicities not included in the four main race and ethnicity categories (non-Hispanic White, non-Hispanic Black, Hispanic, and Asian) represent a small proportion of VLI households (2.9 percent), thus appearing in the upper-left quadrant of the exhibit. However, about 33.1 percent of these households experienced worst case housing needs. Non-Hispanic White households accounted for a relatively large share of the VLI renter household population (42.7 percent) and had a relatively large prevalence of worst case needs (45.0 percent), thus appearing in the upper-right quadrant of the exhibit. All subgroups except non-Hispanic Black households and other race/ethnicity households experienced worst case needs at a higher rate than the national average of 44.2 percent.

Exhibit 1-6 shows an increase in the number of households with worst case needs among Hispanic renters and non-Hispanic White renters between 2021 and 2023. Hispanic households had the greatest increase of worst case needs between 2021 and 2023, with 100,000 additional cases, followed by an increase of about 33,000 additional cases among non-Hispanic White households. Non-Hispanic Black renters had a reduction of 121,000 cases, and other race/ethnicity households had a decrease of 72,000 cases. The proportion of VLI renters receiving housing assistance mostly remained unchanged overall between 2021 and 2023. Non-Hispanic Black and other race/ethnicity VLI renters were the only groups to experience an increase in the housing assistance rate, an increase from 36.1 percent in 2021 to 39.4 percent in 2023 for non-Hispanic Black renters and from 25.8 percent to 28.5 percent for other race/ethnicity renters. The number of assisted renters increased, whereas the number of VLI renters decreased by 3.2 percent among non-Hispanic Black renters and by 5.2 percent for other race/ethnicity renters.

—————————————————————————————————————— 25 See exhibit A-9 for more detail on the prevalence of housing problems among VLI renters by race and ethnicity.

8 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit 1-6. Trends in Worst Case Needs by Racial and Ethnic Group, 2013–23

Notes: The Worst Case Needs Report began separating Asian households from the other race/ethnicity group in 2017. However, for the purposes of this chart, Asian households are included in the other race/ethnicity group.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Alongside the absolute changes in numbers, changes in the prevalence of worst case needs among VLI renters also differed among racial and ethnic groups. Between 2021 to 2023, the rate of worst case needs modestly improved for VLI non-Hispanic Blacks and other race/ethnicity renters while the rate worsened for VLI Asians, non-Hispanic Whites, and Hispanic renters, whose high rates remained above the national average of 44.2 percent. The prevalence of worst case needs increased by 2.5 percentage points (to 55.1 percent) for Asians, by 1.0 points (to 45.0 percent) for non-Hispanic Whites, and by 0.6 points (to 48.0 percent) among Hispanics.

Exhibit 1-6 also illustrates differences in the long-term growth of worst case needs. Between 2013 and 2023, worst case needs increased 9.6 percent overall. However, worst case needs expanded much more rapidly during these 10 years among non-White people, with increases of 22.9 percent among Hispanic renters, 8.7 percent among non-Hispanic Black renters, and 19.1

percent among renters of all other races and ethnicities (including Asian).26 The largest subgroup of VLI renter households, non-Hispanic White, was the only group to experience a minimal increase in worst case needs since 2013, an increment of 1.7 percent. In the most recent

—————————————————————————————————————— 26 The Worst Case Needs Report began separating Asian households from the other race/ethnicity group in 2017. For exhibit 1-6, Asian households are included in the other race/ethnicity group.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 9 biennial period, the population of non-Hispanic White VLI renter households nominally decreased by 1.3 percent, non-Hispanic Black VLI renter households decreased by 3.2 percent, and other races and ethnicities renters decreased by 22.3 percent, whereas VLI Asian and Hispanic renters grew more rapidly, with increases of 8.7 and 3.3 percent, respectively.

Although non-White VLI renters who are not Hispanic, non-Hispanic Black, or Asian make up a small share (2.2 percent) of households with worst case needs, the AHS sample is large enough to provide detailed national estimates for some subgroups within this category. Beginning with the 2017 AHS, HUD has reported estimates of worst case needs for American Indian or Alaska Native and Native Hawaiian or other Pacific Islander households. This detail in exhibit 1-7 provides additional insight into the composition of the small but growing group of “other race or

ethnicity” renters of exhibit 1-6.27

Although the estimates in exhibit 1-7 provide one indication of the prevalence of severe housing affordability and quality problems among those populations, the HUD Native American Housing Needs Study also found that overcrowding and doubling up were far more common among

Native American households compared with other households in the United States.28 Thus, estimates of worst case housing needs should be viewed as one component of a larger body of evidence on housing problems among American Indian or Alaska Native and Native Hawaiian or other Pacific Islander households in Tribal and urban areas.

—————————————————————————————————————— 27 Further detail about the size, characteristics, and margins of error for these population groups is available in the

Household Demographics table of the AHS Table Creator: https://www.census.gov/programs-

surveys/ahs/data/interactive/ahstablecreator.html.

28 The series of reports produced by the Native American Housing Needs Study are available at

https://www.huduser.gov/portal/native_american_assessment/home.html.

10 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit 1-7. Worst Case Needs Among Detailed Race and Ethnicity Subgroups, 2023

Native

Hawaiian

American or

Non- Non- Indian or Other All Other

Hispanic Hispanic Alaska Pacific Races and

Needs White Black Hispanic Asian Native Islander Ethnicities

0–30% AMI renter

households 4,990 3,180 2,872 649 104 37 185

(thousands)

Worst case needs 2,479 1,332 1,528 368 13 9 80 (thousands)

Percent with worst 49.7 41.9 53.2 56.7 12.5 24.3 43.2 case needs

> 30–50% AMI

renter households 3,178 1,549 1,850 316 55 27 148

(thousands)

Worst case needs 1,200 469 741 164 6 15 61 (thousands)

Percent with worst 37.8 30.3 40.1 51.9 10.9 55.6 41.2 case needs

income renter 8,168 4,729 4,722 965 159 64 333 households Total very low-

(thousands)

Worst case needs 3,679 1,801 2,269 532 19 24 141 (thousands)

Percent with worst 45.0 38.1 48.1 55.1 11.9 37.5 42.3 case needs

AMI = Area Median Income. All Other Races and Ethnicities = racial or ethnic group not listed individually or consisting of multiple races or ethnicities.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Worst Case Needs by Household Type

The composition of different households reflects variations in their stage of life, income and resources, and housing needs. “Other nonfamily households” (mainly single adults) constituted the largest share of households experiencing worst case needs in 2023, accounting for 33.0 percent of households with worst case needs. Older adult households without children (hereafter, older adult households) accounted for 29.1 percent of households with worst case needs, families with children accounted for 27.6 percent, and “other family households” (including multiple

family members without children) accounted for 10.3 percent (exhibit 1-8).29

—————————————————————————————————————— 29 See appendix E for more on the definition and composition of household types.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 11 Exhibit 1-8. Prevalence of Worst Case Needs by Household Type, 2023

VLIR = very low-income renters.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

As a share of VLI renter households, the subgroups based on household type span a range of 24.4 percentage points, but the prevalence of worst case needs varied by only 13.4 percentage points. Exhibit 1-8 shows that VLI renter households constitute similar proportions of older adult families (33.2 percent), other nonfamily households (29.7 percent), and families with children (28.4 percent), whereas only 8.8 percent of VLI renter households are other family households. Other nonfamily households and other family households are somewhat more likely to have worst case needs than the other household types. Compared with the national prevalence of 44.2 percent (horizontal dotted line), 52.2 percent of other family households, 49.2 percent of other nonfamily households, 42.9 percent of families with children, and 38.8 percent of older adult households have worst case needs.

Older Adult Households. The largest household type among VLI renters, older adults without children, saw a marginal decrease in the proportion of worst case needs cases between 2021 and 2023. However, the number of older adult households experiencing severe housing problems steadily climbed during the past decade, with 991,000 additional cases since 2013. In 2023, 2.46 million older adult renters had worst case needs, an increase of 113,000 since 2021, even as 296,000 more of these households reported receiving rental assistance in 2023. The increase is largely attributable to the growing population of older adult VLI renter households. The proportion of older adult VLI renter households with worst case needs was 38.8 percent in 2023, representing a 1.3-percentage-point decline since 2021. Although nearly 4 in 10 older adult VLI households received housing assistance in 2023—a 1.9-point increase since 2021—aging baby boomers are likely to continue to be a key demographic facing housing problems in the years to come.

12 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Families With Children. Families with children are the third most common household type among VLI renter households (after older adult households and other nonfamily households). The number of families with children with worst case needs decreased by 296,000 between 2021 and 2023 (exhibit 1-9). Worst case needs among families with children remained 500,000 cases below the peak rate observed in 2013.

Exhibit 1-9. Trends in Worst Case Needs by Household Type, 2013–23

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

The share of VLI renter households with children experiencing worst case needs decreased by 1.5 percentage points from the 2021 level to 42.9 percent in 2023, and the percentage reporting housing assistance remained the same at 23.8 percent.

Among the 5.44 million VLI renter households with children, 1.29 million reported having rental assistance in 2023 and, by definition, could not have worst case needs. Only about one in four

VLI renter households with children received housing assistance.30

—————————————————————————————————————— 30 Estimates of the number of rental households that reported receiving rental housing assistance are presented for various subgroups in the exhibits of appendix A. AHS estimates of assisted VLI renters in this report rely on self-reported data, which primarily include HUD-assisted households and may also include households assisted through other federal, state, or local programs, such as U.S. Department of Agriculture rental housing subsidies. As expected, HUD administrative data matching procedures suggest that excluding households assisted by non-HUD programs reduces the number of households classified as receiving housing assistance. For the purposes of this report, however, households receiving assistance from a non-HUD program are not classified as having worst case housing needs. Because administrative data matching across several federal, state, and local agencies is not feasible, AHS self-reported assistance is the preferred measure of housing assistance for this report. The aggregate numbers of

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 13 Other Family Households. After considering families with children and older adult households, other households can be divided into those that include multiple members of a given family (other family households) and those that do not (other nonfamily households). Other family households include households such as married couples who are childless, one or more parents with adult children at home, adult or minor siblings sharing an apartment, and householders

boarding an older adult parent.31

Other family households constitute the smallest category in exhibit 1-9, contributing 874,000 worst case households in 2023. The rate of worst case needs among VLI renter households in this group was 52.2 percent, exceeding the prevalence for either families with children or older adult households. The high rate of the worst case needs among this group grew by 2.2 percentage points between 2021 and 2023, more than for any other household type. An increase of 162,000 VLI households in this subgroup contributed to the increment, although complex dynamics within this small, diverse group are likely driving the change.

Other Nonfamily Households. About 5.68 million VLI renter households in 2023 were other nonfamily households, making this category the second largest after older adults. Like most household types, the number of VLI other nonfamily households increased between 2021 and 2023.

Worst case needs affected 2.80 million other nonfamily households in 2023, an increase of 166,000 since 2021 and the largest increase across the household types. The large number of VLI renters of this group continued to experience a high prevalence of worst case needs, which increased from 46.0 percent in 2021 to 49.2 in 2023. Most other nonfamily households are single

individuals, and the rest are unrelated people sharing a housing unit.32 One-person VLI households may be less equipped to handle rent increases than those who share housing costs with a roommate or, in family households, with a family member. Income shocks may also affect one-person households more severely than households in which two or more people contribute

resources to the household.33

Worst Case Needs by Marital Status

New analysis using the 2023 AHS focuses on the role of marriage in worst case needs, examining differences in prevalence of worst case needs among married-couple households and other households for VLI renters as well as U.S. households overall. Married-Couple Households in this analysis are defined as those with at least one married couple living together. Other Households for purposes of this analysis are those with no married couple living together

—————————————————————————————————————— households served by HUD’s primary rental assistance programs, based on administrative records, are outlined in appendix C. Federal stimulus payments, such as payments that were part of the Coronavirus Aid, Relief, and Economic Security Act, were not included when calculating income in census surveys. 31 Among “other family” VLI renter households, 37.1 percent include a married couple, 60.7 percent have a female householder, 65.1 percent have a non-White householder, and the mean household size is 2.5 persons. See exhibit A-6A. 32 Among nonfamily VLI renter households, 85.2 percent were one-person households in 2023. See exhibit A-6A. AHS does not include college students living in institutional housing, but it may include students sharing off-campus housing and other households in which individuals double up to share housing expenses. 33 In a similar vein, within the population experiencing homelessness, individual households comprising single adults, unaccompanied youth, or multiple adults are more prevalent than family households consisting of at least one adult and one minor child (HUD, 2024). Likewise, a recent study of community-level predictors of homelessness found that higher population rates of one-person households were associated with higher homelessness rates (Nisar et al., 2019).

14 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS in the unit. Such households may include unmarried parents with children, as well as individuals who are married but living separately, separated, divorced, or widowed. These households may have more than one adult—for example, unmarried partners, siblings, a grandparent, or even roommates.

Across all U.S. households, married-couple households are much less likely to have worst case housing needs than other types of households (3.8 percent compared to 11.9 percent) because they tend to have higher incomes to elevate them out of VLI status and higher rates of homeownership to take them out of the renter category.

Exhibit 1-10. Prevalence of Worst Case Needs Among VLI Renters With Children and All Households With Children, by Presence of a Married Couple, 2023

Prevalence Married-Couple Other

Households Households

Prevalence of WCN among U.S. 3.8% 11.9% households

VLI = very low income. WCN = worst case needs.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Exhibit 1-11. Prevalence of Worst Case Needs Among Older Adult VLI Renters and All Older Adult Households, by Presence of a Married Couple, 2023

Prevalence Married-Couple Other

Households Households

Prevalence of WCN among U.S. 1.6% 8.7% households

VLI = very low income. WCN = worst case needs.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Exhibit 1-12. Prevalence of Worst Case Needs Among Other Family VLI Renters and Other Family Adult Households, by Presence of a Married Couple, 2023

Prevalence Married-Couple Other

Households Households

Prevalence of WCN among U.S. 1.9% 8.7% households

VLI = very low income. WCN = worst case needs.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Households That Include People With Disabilities

Having worst case needs can be especially difficult for renter households that include people with disabilities. Individuals with disabilities may have fewer employment options and additional difficulties in finding suitable housing at a reasonable cost because of a lack of accessible housing and workplaces; features that are luxury amenities for some households, such as elevators, may be necessities for people with disabilities. In addition, Supplemental Security

Income (SSI) benefits are inadequate to cover housing costs in many markets.34

—————————————————————————————————————— 34 For 2023, the SSI monthly federal benefit rate for an individual living alone is $914. See “SSI Federal Payment

Amounts” at https://www.ssa.gov/oact/cola/SSIamts.html.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 15 Disability and Accessibility in the American Housing Survey

Since 2009, the American Housing Survey (AHS) has collected information about the following types of disabilities:

• Deafness or serious difficulty hearing. • Blindness or difficulty seeing, even when wearing glasses. • Serious difficulty concentrating, remembering, or making decisions because of a physical,

mental, or emotional condition.

• Serious difficulty walking or climbing stairs. • Serious difficulty dressing or bathing.

• Difficulty doing errands alone because of a physical, mental, or emotional condition. The 2015 AHS introduced questions related to the wheelchair accessibility of housing units and whether home modifications were made to accommodate individuals with physical disabilities. The 2019 AHS included a topical module of questions related to housing accessibility features. For further information, see the demographics and accessibility sections of the AHS Codebook interactive tool (Census Bureau and HUD, 2023b).

Beginning with the 2009 AHS, respondents have been asked directly whether household members have any of six types of disabilities, including four basic functional limitations—visual, hearing, cognitive, and ambulatory—and two types of difficulties with activities of daily living— self-care and independent living. The most frequently reported disabilities among VLI renter households in which a person younger than 62 has a disability were cognitive limitations (serious difficulties concentrating, remembering, or making decisions), affecting 46.5 percent; ambulatory limitations (walking or climbing stairs), affecting 39.3 percent; and independent living limitations, affecting 28.1 percent. These households often have the added burden of worst case needs, which affected 46.9 percent of those with cognitive limitations, 42.2 percent of those

with ambulatory limitations, and 30.8 percent of those with independent living limitations.35

People with disabilities are found among all four household types discussed previously. As exhibit 1-13 shows, 3.14 million VLI renter households (16.4 percent of VLI renter households)

had people younger than 62 reporting at least one of the six measures of disability.36 In 2023, 1.16 million (37.0 percent) of these households experienced worst case needs, a modest decrease from 1.26 million (37.4 percent) in 2021. Between 2021 and 2023, both the number of VLI renter households with people younger than 62 who have disabilities and the number of such households with worst case needs decreased.

—————————————————————————————————————— 35 The data about types of limitations are summarized in appendix A, exhibit A-15. Also, see HUD (2008). 36 The analysis is limited to people younger than 62 who have disabilities because many older adults suffer from impairments and activity limitations as consequences of aging. Note, however, that people younger than 62 who have disabilities may be found in older adult households, as exhibit 1-13 demonstrates. Households headed by older adults with disabilities are not excluded if they also include people younger than 62 who have disabilities.

16 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit 1-13. Worst Case Needs Among Households With People with Disabilities, 2023

Families Other Other

With Older Adult Family Nonfamily

Households Children Households Households Households Total

Very low-income renter 5,439 6,345 1,675 5,682 19,141 households (thousands)

Worst case needs 2,333 2,462 874 2,795 8,464 (thousands)

Percentage with worst 42.9 38.8 52.2 49.2 44.2 case needs

Percentage having

people younger than 62 17.3 2.4 26.7 28.2 16.4 who have disabilities

Very low-income renter

households having

people younger than 62 940 154 448 1,601 3,143

who have disabilities

(thousands)

Worst case needs 345 57 175 585 1,162 (thousands)

Percentage with worst 36.7 37.0 39.1 36.5 37.0 case needs

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Exhibit 1-13 shows that the prevalence of worst case needs among VLI renter households with people younger than 62 who have disabilities varied somewhat by household type. Prevalence ranged from 36.5 percent for other nonfamily households to 39.1 percent for other family households. Notwithstanding these differences in prevalence, the largest household categories accounted for most cases of worst case needs affecting people with disabilities. Of the 1.16 million households (with people younger than 62 who have disabilities) with worst case needs, 50.3 percent are other nonfamilies, 29.7 percent are families with children, and 15.1 percent are other family households.

Overcrowding and Worst Case Needs

Overcrowding is defined as the condition of having more than one person per room in a

residence, considering only whole rooms such as bedrooms, living rooms, dining rooms,37 kitchens, recreation rooms, lodgers’ rooms, and other finished rooms. HUD categorizes overcrowding as a moderate housing problem rather than a severe problem that is sufficient to trigger a worst case needs designation. A household’s decision to rent an undersized unit might be a way to avoid taking on the severe cost burdens or severe physical inadequacies associated with appropriately sized units. However, overcrowding may be a lease violation that brings the risk of eviction. Furthermore, overcrowding can be harmful to health and educational outcomes

—————————————————————————————————————— 37 A dining room, to be counted, must be a separate room.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 17 and family dynamics (Solari and Mare, 2012). For such reasons, it is useful to examine in detail the extent of rental unit overcrowding and its overlap with worst case needs.

In 2023, about 797,000 VLI renter households, or 4.2 percent, were overcrowded (exhibit 1-14). Households with worst case needs accounted for 365,000 (45.8 percent) of the overcrowded VLI renter households. However, cost burdens were common among both overcrowded and uncrowded VLI renter households. Among overcrowded households, 32.1 percent had moderate cost burdens, and 49.8 percent had severe cost burdens. Among uncrowded households, only 24.7 percent had moderate cost burdens, but severe cost burdens were more prevalent at 55.3 percent. This pattern suggests that some households with worst case needs may accept severe cost burdens as the price of avoiding overcrowding.

Exhibit 1-14. Overcrowding Problems and Other Housing Problems Among Very Low-Income Renters, 2023

Not Percent

Households (thousands) Overcrowded Overcrowded Total Overcrowded

Worst Case Needs Status

Worst Case Needs 365 8,099 10,673 3.4%

Not Worst Case Needs 433 10,240 8,464 5.1%

Total 797 18,340 19,137 4.2%

Housing Cost Burden

NA (no income) 25 804 829 3.0%

No burden (costs 0–30% income) 119 2,873 2,992 4.0%

Moderate burden (costs 30–50% income) 256 4,523 4,779 5.4%

Severe burden (costs 50% or more of income) 397 10,140 10,537 3.8%

Total 797 18,340 19,137 4.2% N = 19,140 million very low-income (VLI) renters. NA = not applicable. Note: Totals across breakout groups do not equal total VLI renters or crowded households because of the difference in the weights of each variable used in this table.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

In 2023, families with children were the most common household type among VLI renters to experience overcrowding, with 753,000 cases accounting for 94.5 percent of overcrowded households (exhibit 1-15). This preponderance reflects the substantially greater prevalence of overcrowding among families with children, 13.8 percent, than among other household types. Other nonfamily households, which might include large households of unrelated individuals, only rarely experienced crowding at 0.2 percent.

Overcrowded households predictably tend to be those with more members. Among VLI renters, 657,000, or 82.4 percent of overcrowded households, had five or more members. Forty-two percent of households with five or more members were overcrowded compared with 17.6 percent of two- to four-member households.

18 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit 1-15. Overcrowding Problems and Demographics of Very Low-Income Renters, 2023

Households (thousands) Not Percent Overcrowded Total Overcrowded Overcrowded

Household Type

Older Adults without Children 18 6,326 6,344 0.3%

Families with Children 753 4,686 5,439 13.8%

Other Family Households 17 1,658 1,675 1.0%

Other Nonfamily Households 9 5,673 5,682 0.2%

Total 797 18,340 19,140 4.2%

Household Size

1 0 9,771 9,771 0.0%

2–4 140 7,666 7,806 1.8%

5+ 657 906 1,563 42.0%

Total 797 18,343 19,140 4.2%

Race and Ethnicity

Non-Hispanic White 136 8,032 8,168 1.7%

Non-Hispanic Black 106 4,623 4,729 2.2%

Hispanic 482 4,240 4,722 10.2%

Asian 57 908 965 5.9%

Other 17 539 556 3.1%

Total 797 18,340 19,140 4.2% N = 19,140 million very low-income renters.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

More than one-half of overcrowded VLI renter households in 2023—480,000, or 60.5 percent— were Hispanic (exhibit 1-15). Non-Hispanic White renters accounted for 17.1 percent of overcrowded VLI renter households, non-Hispanic Black renters for 13.3 percent, Asian renters for 7.2 percent, and other races and ethnicities for 2.1 percent. Higher prevalence was an important factor in the number of crowded Hispanic households because their overcrowding rate of 10.2 percent substantially exceeded the rates of 5.9 percent among Asian households, 3.1 percent among other races and ethnicities, 2.2 percent among non-Hispanic Black households, and 1.7 percent among non-Hispanic White households. Considering the frequency of crowding among families with children, it is worth noting that among VLI renters, like other households, mean family sizes among families with children did not vary greatly by race and ethnicity. The mean number of children ranged from 1.7 among Asian households to 2.0 among Hispanic households.

Summary

Worst case needs for affordable rental housing were a serious national problem in 2021 and remained substantially high in 2023. Of the 19.14 million VLI renter households susceptible to severe rent burdens and severely inadequate housing in 2023, 8.46 million—44.2 percent—faced one or both problems without housing assistance. Between 2021 and 2023, the number of households with worst case needs decreased by less than 1 percent. In 2023, the number of worst case needs was the second highest observed, insignificantly below the record level set in 2021.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 19 The data are a reminder of the enduring impact of the financial crisis and recession that, a decade later—and compounded with the effect on the labor market from the mandatory social distancing restrictions imposed during the COVID-19 pandemic—continue to affect personal finances, credit histories, and affordable housing opportunities.

Severely inadequate housing continues to be a relatively minor cause of worst case needs. In 2023, severely inadequate housing alone produced a mere 2.0 percent of worst case needs, whereas 98.0 percent of households with worst case needs had severe rent burdens, including 2.6 percent that had both types of housing problems. Reflecting the importance of severe rent burdens as a cause of worst case needs, 7 out of 10 households with worst case needs (68.6 percent) had ELIs during 2023.

Between 2021 and 2023, worst case needs increased by 100,000 among Hispanic households, by 65,000 among Asian households, and by 33,000 among non-Hispanic White households; non-Hispanic White households accounted for 43.5 percent of all worst case needs in 2023. VLI Black households and households in the other race/ethnicity subgroup experienced a decrease in cases of worst case needs between 2021 and 2023 as the number of renter households with very low incomes in each of these two groups decreased. Worst case needs decreased by 121,000 among non-Hispanic Black households and by 139,000 among non-White households who are not Hispanic, non-Hispanic Black, or Asian (that is, “other race/ethnicity”).

All household types except older adults included fewer VLI renters in 2023 than they had in 2021. Among VLI renter households, worst case needs affected 42.9 percent of families with children, 38.8 percent of older adult households, 52.2 percent of other family households, and 49.2 percent of other nonfamily households (typically one-person households). Although the number of worst case needs between 2021 and 2023 increased by 113,000 cases among older adults with no children and 166,000 cases among other nonfamily households, such problems decreased by 296,000 cases among families with children and 44,000 cases among other family households. In 2023, other nonfamily households accounted for the greatest share of worst case needs (33.0 percent), followed by older adult households (29.1 percent), families with children (27.6 percent), and other families (10.3 percent).

Worst case needs were common among households with younger people with disabilities. For example, 37.0 percent of VLI renter households with people younger than 62 with disabilities experienced worst case needs in 2023, moderately less than the 44.2-percent prevalence among VLI renter households overall. Households having people younger than 62 who have disabilities accounted for 13.7 percent of worst case needs.

Approximately 797,000 VLI renters were underhoused or lived in overcrowded units in 2023. About 45.8 percent of these households had worst case needs (meaning they also had a severe housing cost burden or lived in severely inadequate housing, or both). Most overcrowded households (94.5 percent) were families with children. More than one-half (60.5 percent) of overcrowded households were Hispanic, 17.1 percent were non-Hispanic White, and 13.3 percent were non-Hispanic Black. The majority (82.4 percent) of overcrowded households have five or more members.

Section 2 examines how the broad problem of worst case needs is caused by shortages of affordable housing and mitigated by assisted housing on a national basis and within regional markets.

20 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Section 2. The State of Affordable Housing

The United States faces a widespread shortage of rental units that are affordable to very low-income (VLI) renter households. The supply of affordable units is especially insufficient to meet the needs of extremely low-income (ELI) households. In 2023, only 66 affordable units (including assisted units) existed for every 100 ELI renter households nationwide. The presence of higher-income renters in units that are affordable to ELI renter households exacerbates this shortage. In 2023, only 38 of the 66 units affordable to ELI households were available for occupancy by ELI households. A final factor is that a small but significant portion of the affordable and available stock continues to be physically inadequate and may pose threats to occupants. In 2023, only one-half of the affordable units (34 of 66 affordable units) were both physically adequate and available for occupancy for every 100 ELI renter households. The geography of worst case needs and housing assistance sets a foundation for understanding the competition for affordable rental housing and its shortages.

Geography of Worst Case Needs

Housing markets are localized and often contain distinct submarkets. VLI and ELI renter households are more likely than higher-income renters to find their choice of housing units limited to communities and neighborhoods where poverty is more common. Such market segmentation and supply restrictions can manifest differently across market types in terms of renters’ likelihood of experiencing worst case needs.

As a national survey of modest scale, the American Housing Survey (AHS) does not support biennial estimates of worst case needs for most individual metropolitan areas or for highly

localized submarkets.38 However, it does support select estimates of worst case needs for certain large metropolitan areas included in the survey sample. AHS includes a national examination of four types of metropolitan locations—central cities, urban suburbs of central cities, rural suburbs of central cities, and nonmetropolitan areas—and four geographic regions—the Northeast,

Midwest, South, and West.39 Analysis of AHS data by region and metropolitan status adds considerable depth to the national picture of worst case needs.

Worst Case Needs and Housing Assistance by Region and Metropolitan Location

A key aspect of the definition of worst case needs is that it can be understood as an indicator of the need for affordable housing. Because income-based rental assistance and other deep public subsidies generally make housing affordable for those receiving the subsidies (although it is possible that such assistance may increase worst case needs for those not receiving subsidies), the definition of worst case needs excludes renters with housing assistance. Examining the

—————————————————————————————————————— 38 HUD and the U.S. Census Bureau have traditionally conducted periodic AHS metropolitan surveys to supplement the national AHS. In 2015, AHS was redesigned with a new national and metropolitan area longitudinal sample to account for changes in geography and attrition of housing units over time. In 2023, as in 2017, a supplemental sample of housing units in select metropolitan areas was combined with the national sample to produce metropolitan-level estimates. Standalone surveys were also conducted in some additional metropolitan areas. 39 Both central cities and suburbs are within metropolitan areas. A central city consists of the largest city within a metropolitan area. Suburbs are within metropolitan counties but outside central cities. For the purposes of this report, suburban areas are further distinguished as urban or rural based on their population density. Nonmetropolitan areas fall outside metropolitan counties and tend to be more rural in nature.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 21 spatial distribution of housing assistance and worst case needs together provides information about the extent to which rental assistance mitigates severe housing problems.

Exhibit 2-1 shows the distribution of the nation’s 19.14 million VLI renter households across the four census regions and four metropolitan categories in 2023. On a regional basis, more than one-third of VLI renter households (6.78 million) lived in the South, 4.44 million in the West, 3.98 million in the Northeast, and 3.95 million in the Midwest. Central cities were home to most VLI renter households (8.90 million), followed by suburbs (8.02 million) and nonmetropolitan

areas (2.22 million).40,41 These geographic patterns did not change substantially between 2021 and 2023.

Exhibit 2-1. Number and Characteristics of Very Low-Income Renters by Region and Metropolitan Location, 2023

Metropolitan Location

Region Central Suburbs, Suburbs, Nonmetropolitan Total Cities Urban Rural Areas

Northeast (thousands) 2,065 1,479 211 223 3,978

Percentage with worst case needs 34.1 41.7 43.0 29.3 37.2

Percentage with housing 43.3 31.5 23.9 44.9 38.0 assistance

Midwest (thousands) 1,743 1,185 294 726 3,947 Percentage with worst case needs 38.5 42.2 32.1 37.0 38.8

Percentage with housing 30.2 23.7 27.9 29.4 27.9 assistance

South (thousands) 2,772 2,122 878 1,003 6,775 Percentage with worst case needs 46.3 54.5 37.0 39.7 46.7

Percentage with housing 28.5 18.7 20.8 30.3 24.7 assistance

West (thousands) 2,324 1,581 270 265 4,440 Percentage with worst case needs 50.2 56.4 48.3 37.6 51.5

Percentage with housing 27.3 21.2 20.0 21.9 24.4 assistance

Total (thousands) 8,904 6,366 1,653 2,217 19,140 Percentage with worst case needs 43.0 49.7 38.8 37.5 44.2

Percentage with housing 31.9 23.2 22.3 30.5 28.0 assistance

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Like VLI renter households, worst case needs were common in every region and metropolitan category across the nation. As a national average, 44.2 percent of VLI renter households had worst case needs in 2023. The prevalence of worst case needs among VLI renter households was

—————————————————————————————————————— 40 Among suburban VLI renter households, most (79.4 percent) were concentrated in densely populated urban suburbs. 41 Changes in annual estimates of VLI renter households in nonmetropolitan areas should be viewed with caution because HUD assigns average income limits to less populated areas to accommodate AHS data suppression. See the discussion of income cutoffs in association with AHS geography in appendix E.

22 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS greater than the national average in the South and West and in urban suburbs. The Midwest, Northeast, central cities, rural suburbs, and nonmetropolitan areas had smaller-than-average shares of VLI renter households with worst case needs. The national total of 8.46 million worst case needs in 2023 consisted of 3.17 million households in the South, 2.29 million in the West,

1.53 million in the Midwest, and 1.48 million in the Northeast.42

The data in exhibit 2-1 show worst case needs and rental assistance by region. Nationwide, 5.37 million VLI renter households reported receiving housing assistance in 2023 compared with the

8.46 million having worst case needs.43 Thus, 1.6 VLI renter households had worst case needs for every 1 that received assistance, a slightly lower ratio than 1.7 to 1 in 2021. Put differently, among VLI renter households, 28.0 percent of households had rental assistance, and an additional 44.2 percent had worst case needs for rental assistance or other subsidized housing in 2023 (exhibit 2-2). The remaining residual (27.7 percent) rented in the private market without housing assistance and avoided severe housing problems. These data suggest that in 2023, fewer than one in three VLI renters were able to secure housing on the private rental market without rental assistance and without experiencing severe rent burden or severely inadequate conditions (exhibit 2-2).

Exhibit 2-2. Housing Problem Status of Very Low-Income Renter Households by Relative Income, 2023

AMI = Area Median Income.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

—————————————————————————————————————— 42 See appendix exhibit A-10 for additional regional data. 43 AHS questions about receipt of rental assistance are designed to focus on federal housing assistance programs. These data result in an estimated 5.37 million self-reported VLI renter households with housing assistance, which is somewhat more than HUD’s program total. Other potential sources of housing assistance include the U.S. Department of Agriculture’s Rural Housing Service, other federal agencies, or other state or local programs. Also affecting this comparison, a small fraction of HUD-assisted renters may have incomes above the VLI threshold because they were admitted to programs under local policy preferences or their incomes increased after program admission. See the discussion of HUD’s rental assistance programs in appendix C and housing assistance status in appendix E.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 23 Nationally, housing assistance is relatively less common in the suburbs, where less than 25 percent of VLI renter households in 2023 were assisted compared with 28 percent overall. The rapidly expanding central cities and suburbs in the South and West had particularly low rates of assistance. These regional disparities in the prevalence of housing assistance for VLI renter households were also evident nationally, ranging from 24.4 percent assisted in the West to 38.0 percent assisted in the Northeast. Another region with a low rate of housing assistance, the South (24.7 percent), has had the second highest rate of worst case needs for decades (46.7 percent) and thus accounts for 37 percent of worst case needs. More than one-half—51.5 percent—of VLI renter households in the West experienced worst case needs in 2023. Areas that developed during an earlier period continue to draw benefits from an established but aging stock of public housing.

Exhibit 2-3 illustrates the correlation between rental assistance and worst case housing needs. It is important to note that the relationship between rental assistance and worst case needs is not causal, because other factors, such as wages, rent prices, and population growth, may be more determinative of worst case needs than the prevalence of rental assistance in any given region. In exhibit 2-3, central cities, suburbs, and nonmetropolitan areas are represented by purple, pink, and cyan bubbles, respectively. Larger bubbles represent a larger national share of worst case needs households. Across regions and metropolitan locations, housing assistance is inversely related to worst case needs. Locations indicated in the upper-left quadrant of the chart fared better than the national average because of higher rates of housing assistance and lower prevalence of worst case needs among VLI renter households. The locations clustered in the middle of the chart approximate average prevalence rates. The locations in the lower-right quadrant fared worse than the national average because of lower rates of housing assistance and higher rates of severe housing problems.

Exhibit 2-3. Prevalence of Worst Case Needs by Location and Housing Assistance, 2023

24 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Patterns in the suburbs tended to be worse than those in nonmetropolitan areas nationally, whereas central cities vary. Worst case needs affected a smaller share of VLI renters in nonmetropolitan areas, where housing assistance was relatively more available. Central cities of the Northeast and Midwest also fared better—with higher rates of housing assistance and lower rates of worst case needs—than their counterparts in the South and West.

Worst case needs were more prevalent in the West and the South, especially in the suburbs, where housing assistance was more scarce—although high rents in the West also shape this

picture.44 Several areas with a greater relative scarcity of housing assistance and an abundance of worst case needs account for substantial fractions of the national problem, as the size of the bubbles in the lower-right quadrant of exhibit 2-3 show. The relative size and positioning of the bubbles for central cities and urban suburbs also suggest that denser urban areas contribute the largest shares of severe housing affordability problems. Together, central cities and urban suburbs of the South and West accounted for 53 percent of worst case needs. In recent decades, housing policy has not kept pace with geographic shifts in the national population distribution and housing needs. Policy enhancements to improve the geographic allocation of housing resources could reduce such spatial disparities and their effects on community well-being.

Compared with their urban counterparts, the small populations of VLI renters living in rural suburbs represented a small share of worst case households. However, rural suburbs of the West do have low rates of housing assistance coinciding with high rates of worst case needs.

—————————————————————————————————————— 44 High rents introduce the question of whether enough rental units are available at Fair Market Rents (FMRs) to make housing vouchers an adequate policy response to affordable housing shortfalls. Exhibit B-3 in appendix B addresses the extent of the supply of below-FMR housing on a regional basis. Also, see regional supply discussions later in this section.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 25 Correspondingly, many Western rural suburbs experienced high rates of homelessness in 2017 (Nisar et al., 2019).

Exhibit 2-3 does not show changes in rates of VLI renter households with worst case needs between 2021 and 2023. Although prevalence rates of worst case needs increased by 3.3 percentage points in the West and 1.3 points in the Midwest between 2021 and 2023, prevalence improved in the Northeast—by 3.4 points—and by less than 1 point in the South (exhibit A-10). During the same period, rates of worst case needs decreased slightly, again by less than 1 percentage point, in central cities and rural suburbs, while increasing by 2.1 points in nonmetropolitan areas and by less than 1 point in urban suburbs (exhibit A-11A).

Variation in Worst Case Needs Between Metropolitan Markets

Examining the number of VLI renters and the prevalence of worst case needs across the largest metropolitan areas offers additional insight into the variation of severe housing problems in central cities and suburbs. With their densely populated urban cores connected to surrounding counties through strong commuting ties, metropolitan areas reflect groupings of central cities and suburbs with a high degree of social and economic integration. AHS provides insights about variations in worst case needs across some of the largest metropolitan housing markets. Exhibit 2-4 shows the VLI renter populations and the number and share experiencing worst case needs in the nation’s 15 largest metropolitan areas in 2021 and 2023. Additional metropolitan areas and additional details are in exhibit A-11B.

26 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit 2-4. Renters, Very Low-Income Renters, and Worst Case Needs in Large Metropolitan Areas, 2021–23

Metropolitan Area 2021 2023 Metropolitan Area 2021 2023

Renters Renters Renters Renters

New York-Newark-Jersey San Francisco-Oakland-3,746 3,841 793 799 City, NY-NJ-PA Hayward, CA

Very low-income renters Very low-income renters 1,825 1,858 311 340 (1,000) (1,000)

With worst case needs With worst case needs 799 711 129 152 (1,000) (1,000)

Percent with worst case Percent with worst case 43.8 38.3 41.5 44.7 needs needs

Los Angeles-Long Beach- Philadelphia-Camden-2,475 2,480 Wilmington, PA-NJ-DE- 803 780 Anaheim, CA MD

Very low-income renters Very low-income renters 1,167 1,047 345 300 (1,000) (1,000)

With worst case needs With worst case needs 599 614 157 136 (1,000) (1,000)

Percent with worst case Percent with worst case 51.3 58.6 45.5 45.3 needs needs

Chicago-Naperville-Elgin, Atlanta-Sandy Springs-1,262 1,377 822 787 IL-IN-WI Roswell, GA

Very low-income renters Very low-income renters 523 589 304 272 (1,000) (1,000)

With worst case needs With worst case needs 219 236 159 147 (1,000) (1,000)

Percent with worst case Percent with worst case 41.9 40.1 52.3 54.0 needs needs

Miami-Fort Lauderdale- Seattle-Tacoma-Bellevue, 856 930 658 666 West Palm Beach, FL WA

Very low-income renters Very low-income renters 381 415 239 234 (1,000) (1,000)

With worst case needs With worst case needs 217 245 97 119 (1,000) (1,000)

Percent with worst case Percent with worst case 57.0 59.0 40.6 50.9 needs needs

Houston-The Woodlands- Detroit-Warren-Dearborn, 1,046 1,082 514 493 Sugar Land, TX MI

Very low-income renters Very low-income renters 410 399 221 221 (1,000) (1,000)

With worst case needs With worst case needs 227 244 91 92 (1,000) (1,000)

Percent with worst case Percent with worst case 55.4 61.2 41.2 41.6 needs needs

Dallas-Fort Worth- Phoenix-Mesa-Scottsdale, 1,158 1,224 631 645 Arlington, TX AZ

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 27

Metropolitan Area 2021 2023 Metropolitan Area 2021 2023

Renters Renters Renters Renters

Very low-income renters Very low-income renters 345 370 190 182 (1,000) (1,000)

With worst case needs With worst case needs 171 197 107 104 (1,000) (1,000)

Percent with worst case Percent with worst case 49.6 53.2 56.3 57.1 needs needs

Washington-Arlington- Riverside-San Alexandria, DC-VA-MD-909 834 488 470 Bernardino-Ontario, CA WV

Very low-income renters Very low-income renters 339 353 167 178 (1,000) (1,000)

With worst case needs With worst case needs 154 147 103 97 (1,000) (1,000)

Percent with worst case Percent with worst case 45.4 41.6 61.7 54.5 needs needs

Boston-Cambridge- 791 754 National 45,991 46,378 Newton, MA-NH

Very low-income renters Very low-income renters 373 347 19,338 19,140 (1,000) (1,000)

With worst case needs With worst case needs 139 124 8,526 8,464 (1,000) (1,000)

Percent with worst case Percent with worst case 37.3 35.7 44.1 44.2 needs needs Notes: Estimates for the 15 largest metropolitan areas (by population ranking) are presented. The redesigned American Housing Survey samples these 15 metropolitan areas every 2 years. Estimates for 10 additional metropolitan areas surveyed in 2023 are presented in exhibit A-11B. Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Although 44.2 percent of VLI renter households had worst case needs nationally, local markets show a substantial degree of variation beyond the macro-level trends observed across regions and types of metropolitan locations. Worst case needs affected substantial shares of VLI renter households in each of the nation’s largest metropolitan areas. Among the 15 metropolitan areas in exhibit 2-4, 47.4 percent of VLI renters had worst case needs in 2023 compared with 47.2 percent in 2021, representing a decrease of 3,000 cases. The number of VLI renters in these metropolitan areas decreased by 35,000 households. Reflecting particularly severe local conditions, more than one-half of the VLI renter households residing in and around Houston, Miami, Los Angeles, Phoenix, Riverside (CA), Atlanta, Dallas, and Seattle experienced worst case needs in 2023. The rates of worst case needs decreased in 6 of the 15 large metropolitan areas between 2021 and 2023, with Riverside and New York having the largest respective decreases of 7.2 and 5.5 percentage points. The rates of worst case needs increased in 9 of the 15 large metropolitan areas between 2021 and 2023, with Seattle and Los Angeles having the largest respective increases of 10.3 and 7.3 percentage points. Local events, trends, and policies may account for changing rates of housing problems within metropolitan areas.

28 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Factors Limiting Access to Affordable Rental Housing

Even with slightly more than one-fourth of VLI renter households receiving housing assistance, the demand for naturally affordable rental housing far outstrips supply. Nationally, less than one-third of VLI renter households could avoid severe housing problems in the unassisted private rental market in 2023. An examination of the mismatches between the number of rental units needed by renters of various income categories and the number of affordable units provided by the market to those renters lends considerable insight into private rental market dynamics and the persistence of worst case needs during periods of economic growth.

Surge in Immigration

From March 2022 to March 2024, the foreign-born population in the United States increased by 5.1 million, the largest 2-year increase in American history. The foreign-born population has grown by 20 million since the year 2000, a 40-percent increase, and now stands at the highest level in American history, a staggering 53 million individuals. This population influx has caused significant increases in housing demand and thus, housing prices. Research finds that an increase in immigration inflows into a particular metropolitan statistical area (MSA) is associated with increases in rents in that MSA while also seeming to drive up rents and prices in neighboring MSAs.

Immigration accounts for up to 100 percent of housing demand growth in some regions, and for two-thirds of rental demand growth nationwide. In California and New York, immigrants have accounted for 100 percent of all rental growth and over one-half of all growth in owner-occupied housing in recent years.

In addition, immigration reduces the wages of low- and moderate-income Americans in blue collar occupations, limiting the very income growth that could have otherwise lifted them out of worst case needs status.

This indicates that housing policy leaders must be part of the immigration policymaking

process.45

The growth in households attributable to non-citizens was 13 percent between 2019 and 2023, compared to 7 percent between 2015 and 2019. This further demonstrates that non-citizen households are playing an increasing role in the household growth that is straining the affordable housing supply

Had non-citizen household growth only been 391,000 between 2019 and 2023, as it had been in the 2015-to-2019 period (i.e., 784,000 fewer households formed over that 4-year period), pressures on the housing inventory would have been less and, thus, prices likely would not have surged quite as much as they did. In the last decade, net housing unit additions from 2015 to 2023 did not keep up with household formation among citizens, and non-citizen growth further increased upward pressure on prices in rental markets.

——————————————————————————————————————

45 Authors who examine the role of immigration in household formation and housing demand include Camarota (1998), Edo (2015), Mussa et al. (2017), Myers et al. (2006), Orrenius and Zavodny (2007), and Saiz (2007).

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 29 Adverse Impact of Demand-Side Housing Subsidies

Demand-side housing subsidies increase demand for housing. Because the supply of housing is largely inelastic, an increase in demand causes an increase in prices. This means that while those receiving housing assistance benefit from that assistance, low-income households who do not receive assistance may be harmed by the higher prices caused by the extra demand created by rental assistance. In fact, Susin (2002) estimated that the overall loss to unsubsidized renters caused by the increased rent prices due to rental subsidies may be greater than the benefit accrued to those receiving housing assistance, resulting in a net negative impact on unsubsidized low-income renters.

Another potential adverse impact of housing subsidies results from the use of inclusionary zoning. Inclusionary zoning requires that a certain percentage of units in a housing development be limited to very low-, low-, or moderate-income households, with the rents on those units being capped accordingly. Although this is not rent control, because it functions as a price control on a certain percentage of units, it has many of the same adverse effects as rent control. Specifically, inclusionary zoning reduces the creation of new housing supply because of the developer being unable to charge market rates for the income-limited units. This means that inclusionary zoning can result in the creation of less rental supply and, therefore, higher rent prices.

In addition, by conditioning eligibility for rental assistance upon one’s income being below a certain threshold, rental assistance programs may inadvertently incentivize households to refuse opportunities to increase their earning potential, so that they may continue to qualify for housing assistance. This phenomenon is known as the poverty trap. It may also disincentivize marriage, one of the top proven ways out of poverty, if the new couple’s combined income would be over the threshold to qualify for rental assistance. Thus, by encouraging individuals to keep their income low, and to avoid marriage in order to maintain program eligibility, such subsidies may inadvertently enlarge the population of worst case needs households.

This indicates that housing policymakers should reconsider the design of key housing programs in order to remove unintended consequences that may worsen housing affordability.

Marriage Decline

Housing demand has long been understood to be linked with household formation decisions (Börsch-Supan, 1986). Being married also increases the probability of owning a home by 18

percent, a significant effect.46 Among the 63.5 million married households in 2023, 81 percent are homeowners. But among households with unmarried couples, about as many are

homeowners as are renters.47

Over the long term, the overall marriage rate in the United States has declined, with the median age at which young adults choose to get married also rising over time. Among adults older than

—————————————————————————————————————— 46 Choi et al. (2018) use this disparity in tenure to estimate that the homeownership rate among millennials, after controlling for age, income, race/ethnicity, and education, would have been 5 percent greater in 2015 if the 1990 marriage rate prevailed. Eriksen (2010) also finds in an experimental setting that homeownership (downpayment) subsidies had significant impacts on both marriage status and homeownership.

47 See AHS Table Creator, Table 8A. Household Demographics, by Tenure. https://www.census.gov/programs-

surveys/ahs/data/interactive/ahstablecreator.html.

30 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS age 25, 50.8 percent were married in 2023, down from 56.2 percent in 2020 and 64.2 percent in

1970.48 As the marriage rate decreases, more individuals are living in separate households instead of together in one household as a married couple. This dynamic has the effect of increasing the number of households—an important point considering that an increase in the number of households is the top driver of worst case needs. Combined with the fact that unmarried people are more likely to rent than married people, declining marriage rates cause significant upward pressure on rents. This trend suggests that policymakers should consider interventions that increase marriage rates as a method of improving housing affordability—in addition to other benefits of marriage, such as dramatically improved outcomes for children and reduced incidences of poverty.

How the Market Allocates Affordable Housing on a National Basis

The competition for good-quality housing that is affordable to Americans remains vigorous. Competition affects whether the neediest households can live in the most affordable units, the vacancy rate at different rent levels, and how quickly new units are occupied. Exhibit 2-5 shows the distribution of rental units and their occupancy by their rents’ affordability relative to the

Area Median Income (AMI).49 For this analysis, a unit is considered affordable for a renter if the gross rent (rent plus utilities) does not exceed 30 percent of the maximum income of their

income category.50

Exhibit 2-5. Distribution of Rental Units and Occupancy Status, 2023

Rental Units by Income Needed to Make

the Rent Affordable (thousands)

0–30% > 30–50% >50–80% > 80%

Occupancy Status of AMI of AMI of AMI of AMI Total

Higher-income occupants 3,286 4,232 6,488 NA 14,006

Same-income or lower-income occupants 4,323 5,136 10,366 12,546 32,371

Vacant 296 580 1,395 1,617 3,888

Total 7,905 9,948 18,249 14,163 50,265 AMI = Area Median Income. NA = not applicable.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

The extent of competition for the most affordable housing portrayed is striking. As exhibit 2-5 shows, higher-income renters occupied 3.29 million, or 41.6 percent, of the units affordable to ELI renter households. Similarly, higher-income renters occupied 42.5 percent of units

—————————————————————————————————————— 48 National Center for Health Statistics, “Marriage Rates in the United States, 1900 - 2018,” (April 2020)

https://www.cdc.gov/nchs/data/hestat/marriage_rate_2018/marriage_rate_2018.htm and, U.S. Census Bureau, “Median Age at First Marriage: 1890 to present,”

2.pdf 49 The method of assigning units to cost categories was modified in 2017 to also account for limited HUD administrative https://www.census.gov/content/dam/Census/library/visualizations/time-series/demo/families-and-households/ms-exceptions to program income limits. Slight unit affordability adjustments were applied to outlier cases in which AMI-determined affordability differed from administratively determined affordability categories. 50 Note that renters whose incomes place them at the bottom of an income range would not be able to afford rents at the top of their range. More detailed presentations of these data appear in appendixes A and B, in which exhibits A-12 and B-2 show unit affordability and occupancy status using 10-point income breaks.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 31 affordable at incomes of 30 to 50 percent of AMI and 35.6 percent of units affordable at incomes of 50 to 80 percent of AMI, which is the largest category of units. More affordable rental units were both rarer and more likely to be occupied by higher-income renters.

Variations in vacancy rates across the affordability categories further demonstrate the competition for affordable units. The most affordable units are least likely to be vacant (exhibit 2-6). Among the least costly units—those with rents affordable at incomes of 0 to 30 percent of AMI—only 3.7 percent were vacant in 2023. Vacancy rates were much greater at higher rent levels: 5.8 percent among units affordable at incomes of 30 to 50 percent of AMI, 7.6 percent at 50 to 80 percent of AMI, and 11.4 percent among the highest rent units. Overall, rental vacancy rates fell between 2017 and 2023—9.9 percent in 2017, 9.5 percent in 2019, 8.2 percent in 2021,

and 7.7 percent in 2023—reflecting steady absorption of unoccupied rental housing stock.51 Between 2021 and 2023, further vacancy reduction or tightening was observed among units at the upper end of the VLI affordability range, the 40 and 50 percent of AMI categories.

Exhibit 2-6. Vacancy Rates by Affordability Category, 2019–23

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Despite tightening markets, the gradient in national vacancy rates seen in exhibit 2-6 remained relatively flat among units affordable to low-income renters earning between 50 and 80 percent

—————————————————————————————————————— 51 Comparable estimates of the rental vacancy rate based on the Current Population Survey are slightly lower in recent years: 8.3 percent in 2013, 7.1 percent in 2015, 7.2 percent in 2017, 6.8 percent in 2019, 6.1 percent in 2021, and 5.8 in 2022. See U.S. Housing Market Conditions charting data:

http://www.huduser.org/portal/ushmc/hi_RentVac.html.

32 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS of AMI. Nevertheless, the market for units affordable at ELI levels remained very tight. The somewhat higher vacancy rate for the units affordable at only 10 percent of AMI is often ascribed to units with physical or locational challenges and that may soon be removed from the housing stock. Higher vacancy rates continue to be found at the highest rent levels, including

numerous vacation homes,52 and may reflect developer preferences to construct higher-end rental units in recent years. Regulatory barriers that make affordable homebuilding difficult have exacerbated labor shortages that constrain mid-range rental housing production needed to cope with large tenure shifts and household formation. In many areas, the production of housing for ELI renters is not profitable.

Compared with the market for the most affordable units, the availability of vacant units at higher rent levels shows that in many markets, rental assistance in the form of vouchers could reduce worst case needs to the extent that rents fall within program limits and landlords are willing to participate. The appendix exhibit B-3, which examines the availability of units within HUD program rent limits (including all HUD-assisted housing), shows that about 69 affordable and

physically adequate rental units were available in 2023 for every 100 households nationally.53 Increasing landlord participation in HUD’s voucher program could improve access to those units among VLI households while also improving voucher utilization rates in places where vouchers are available but difficult to lease up.

From 2021 to 2023, the rental stock grew by 187,000 units, or less than 1 percent, yet the number of vacant units decreased by 196,000, or 4.8 percent. Small increases in vacant units accompanied expansions of the overall rental stock in preceding years, yet strong rental demand nationwide kept vacancy rates fairly constrained for renters with median or lower incomes. The rental stock affordable to VLI renters increased by 996,000 units, or 5.9 percent, between 2021 and 2023, whereas the number of affordable vacant units declined much more sharply by 10.8

percent (106,000 units).54

Although vacancy rates provide a valuable indication of the balance between supply and demand, they do not directly compare the number of affordable units with the number of renters. The remainder of section 2 makes such comparisons, employing three increasingly rigorous concepts to assess the sufficiency of the rental housing stock relative to need.

Affordability, Availability, and Adequacy of the National Rental Stock

The scarcity of affordable units is typically greatest for the poorest renters, but because of the rapid increase in renter households and greater competition since the Great Recession and the COVID-19 pandemic, scarcity has extended higher up the income scale. Although the renter population expansion slowed somewhat in 2023, and slightly fewer renter households had very low incomes, rental units largely remained out of reach for households remaining at the lower end of local income distributions. Exhibit 2-7 displays the rental housing stock in 2023. These

—————————————————————————————————————— 52 According to the 2023 American Community Survey 1-year estimates, Table B25004, about one-third of vacant housing units in the United States are for seasonal, recreational, or occasional use. 53 Regional variation in the availability of units within FMR limits is further addressed in the “Rental Stock by Region” discussion later in this section.

54 See exhibits A-12 and A-13.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 33 aggregate data portray how well the overall stock could meet the need for housing that is

affordable if location did not matter.55

The top (cyan solid) line in exhibit 2-7 represents all affordable units in 2023, regardless of whether the units were vacant, occupied by higher-income households, or physically adequate. The cumulative number of affordable units equaled the cumulative number of renters (that is, 100 units per 100 renters) only for incomes exceeding 54 percent of AMI. Beyond that threshold, more than 100 affordable units existed per 100 renters—enough, with perfect allocation, to provide housing that is affordable to every renter with a higher income. The 2023 threshold was 3 percentage points lower than the 2021 level and 9 points higher than the 2007 level, indicating that many households recovering from the recession remained renters for longer periods as the economy recovered.

Exhibit 2-7. Variation in Supply of Rental Housing by Income, 2023

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

The ratio of affordable units per renter peaked at 129 units per 100 renters at the income level of 95 percent of AMI. A substantial surplus of affordable units existed at higher levels of household income on a cumulative basis. As income increased, renters were increasingly likely to spend

less than 30 percent of their income on housing.56

—————————————————————————————————————— 55 Measures of affordability, availability, and adequacy compare the entire housing stock with the entire renter population, and they do not reflect small-scale geographic detail or the complexities of local housing markets. 56 Only 15.7 percent of renters with incomes above 80 percent of AMI had either moderate or severe rent burdens compared with 70.1 percent of renters with lower incomes. See exhibit A-1A.

34 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

The situation was completely different at the low end of the income scale. Enough affordable units—both naturally affordable and assisted—existed to house only 66 percent of ELI renters in 2023, assuming those units somehow could have been perfectly allocated. That shortage was substantial and critical, slightly improving from the ratio of 61 units per 100 renters in 2021 but worsening from the ratio of 70 units per 100 renters observed in 2019.

The second (pink dotted) line in exhibit 2-7 represents all affordable and available rental units in

2023 and considers whether higher-income renters currently occupy affordable units.57 To be available, an affordable unit needs to be either vacant and available for rent or already occupied by a household within its affordability class. Availability poses an important additional constraint on renters seeking affordable units. The exhibit shows that, at best, only 38 percent of ELI renters could find an affordable and available unit, even if location was not a factor.

The occupancy of a considerable proportion of the most affordable housing stock by renters who could afford to spend more but do not choose to do so worsens the paucity of affordable and available units (as exhibit 2-5 previously showed). Such renters may be cautious about their finances because of income instability, may wish to reduce debt burdens, or may be saving for a downpayment to buy a house. In 2023, the affordable stock was nominally sufficient to house every renter with an income greater than 54 percent of AMI, yet the affordable and available stock did not match the number of renters until household incomes reached about 100 percent of AMI.

The third (lilac dashed) line in exhibit 2-7 adds a third criterion—that units should be physically adequate—which further reduces the supply of the rental housing stock. Even for renters with low incomes (up to 80 percent of AMI), only 82 adequate units were available for every 100 renters. The physically adequate stock did not fully match the need until it included units affordable only to renters with incomes exceeding 125 percent of AMI, similar to 2021 levels.

Measuring Whether Affordable Housing Stock is Sufficient for Need

• Affordability measures the extent to which enough rental housing units of different costs can

provide each renter household with a unit it can afford (based on the 30-percent-of-income standard). Affordability, which is the broadest measure of the relative supply of the housing stock, addresses whether sufficient housing units would exist if allocated solely on the basis of cost. The affordable stock includes both vacant and occupied units.

• Availability measures the extent to which affordable rental housing units are available to

renters within a particular income range. Availability is a more restrictive concept because units that meet the definition must be available and affordable. Some renters choose to spend less than 30 percent of their income on rent, occupying housing that is affordable to renters of lower incomes. Those units thus are not available to lower-income renters. A unit is available at a given level of income if (1) it is affordable at that level and (2) it is occupied by a renter either at that income level or at a lower level or is vacant.

• Adequacy extends the concept of availability by considering whether sufficient rental units are

physically adequate (based on unit characteristics described in appendix E), affordable, and available. Adequacy thus is the most restrictive of the three measures.

—————————————————————————————————————— 57 The availability measure also removes units from consideration if they have artificially low rents because they are occupied as a benefit of employment (for example, units provided for caretakers) or because relatives or friends of the occupants own the units. In 2023, 1.96 million renter households (4.2 percent) occupied their units while paying no rent. AHS does not provide estimates of the number of households paying a positive but less-than-market rent because of employment or other reasons.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 35

Rental Stock by Income

Thus far, the analysis has shown that relatively few rental units were affordable in 2023, and— because of occupancy by higher-income renters and limited vacancies—even fewer were available to renters with the lowest incomes. Exhibit 2-8 summarizes the availability of rental units for the standard income groups in this report.

Exhibit 2-8. Availability of Rental Units by Income Category, 2023

Affordable and Affordable,

Affordable Available Available, and

Rental Units Rental Units Adequate Rental

per 100 Renter per 100 Renter Units per 100

Income Category Households Households Renter Households

Extremely low-income renter households 65.8 38.4 33.7 (0–30% AMI)

Very low-income renter households 93.3 58.8 52.0 (0–50% AMI)

Low-income renter households 124.3 90.4 81.5 (0–80% AMI)

AMI = Area Median Income.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

A severe mismatch existed between the number of ELI renter households and the number of affordable units available. For every 100 ELI renter households, only 66 affordable units existed. Only 38 of those units were affordable and available, and only 34 were affordable, available, and physically adequate. About 12 percent of affordable and available units for ELI renters had severe quality deficiencies.

Renters with very low incomes found 93 affordable units, 59 affordable and available units, and only 52 affordable, available, and physically adequate units per 100 renters. About 12 percent of the affordable and available units for this larger group had severe quality deficiencies. Renters with low incomes (as opposed to very low incomes) found that the affordable and available rental stock was nearly sufficient to house them all, although about 10 percent of such units had severe quality deficiencies.

Overall, affordable housing supply moderately improved for ELI renters between 2021 and 2023, expanding by 406,000 units. Exhibit 2-9 shows that the supply of affordable housing stock for ELI renters increased by 5 units per 100 renter households from 61 in 2021 to 66 in 2023. The ratio of affordable and available units increased from 36 units per 100 ELI renter households in 2021 to 38 units in 2023. Supply also improved for the broader group of VLI renters, with affordable units increasing by six units per 100 renters and affordable and available units increasing by 2 units per 100 renters.

36 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit 2-9. Trend in Rental Housing Stock by Income Category, 2019–23

2019 2021 2023

Rental Rental Rental

Units Units Units 2019 to 2021 to

per 100 per 100 per 100 2021 2023

Income Category Renters Renters Renters Change Change

Extremely low-income renter households

(0–30% AMI)

Affordable 70.3 60.9 65.8 – 9.4 4.9

Affordable and available 40.3 36.4 38.4 – 3.9 2.1

Very low-income renter households

(0–50% AMI)

Affordable 96.0 87.2 93.3 – 8.8 6.1

Affordable and available 62.2 56.7 58.8 – 5.5 2.0

AMI = Area Median Income.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Geography of Supply

The preceding discussion shows that worst case needs in 2023 were dispersed across the nation, although their concentration varied across geography. It further shows that the availability and utilization of housing assistance contributed to spatial variation in worst case needs.

Affordable rental housing includes both units that receive public rent assistance and units that for-profit and nonprofit housing providers offer at modest rents. The examination of affordable housing supply on a national basis revealed that the supply of rental units that are affordable to VLI and poorer households remained deeply insufficient in 2023 and that the preference of higher-income renters for more affordable units and the physical inadequacy of some of the stock worsened this shortage.

The following discussion sharpens that picture by showing how shortages vary by geography.

Rental Stock by Region

Rental markets are constrained for ELI renters across the four census regions despite substantial

variation in the availability of affordable rental units.58 Exhibit 2-10 illustrates that the Midwest had the best availability in 2023, with 74 units per 100 VLI renter households. The West was worst off with 45 units per 100 VLI renter households compared with 55 units for the South and 65 for the Northeast. For ELI renters, the availability of affordable units was far from sufficient

—————————————————————————————————————— 58 For renters who could afford rents no greater than the FMR, appendix exhibit B-3 reveals that although enough affordable units existed in each region, the number of available units in each region was sufficient to house only 72 to 82 percent of those renters. For renters who attempt to find a unit with a housing choice voucher, the housing quality standards of that program imply that their success will depend on the prevalence of physically adequate units in their area—not merely affordable and available units. Across regions, only enough physically adequate, affordable, and available units existed to house 67 to 72 percent of renters who could not afford rents higher than FMR.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 37 in any region. Even low-income renters with incomes up to 80 percent of AMI found that not enough affordable units were available in the West, South, and Northeast.

On a regional basis, adding the adequacy test restricted the estimated supply for VLI renters less in the West, which eliminated fewer than 5 units, than in the other regions, which lost 6 to 10 units per 100 VLI renter households. Even so, the West retains its regional disadvantage for such renters across all three measures of sufficiency.

The primary point in exhibit 2-10 is that ELI renter households continued to face severely constrained markets across all four regions. The Northeast, Midwest, and South had affordable units available for roughly two in five ELI renter households, and the West for roughly one in three.

Exhibit 2-10. Rental Housing Stock by Region and Income Category, 2023

Affordable,

Affordable and Available,

Affordable Available and Adequate

Region and Housing Units Housing Units Housing Units

Renter Income Category per 100 Renters per 100 Renters per 100 Renters

Northeast

Extremely low-income (0–30% AMI) 68.2 45.3 37.2

Very low-income (0–50% AMI) 95.4 64.8 55.4

Low-income (0–80% AMI) 124.4 93.0 81.2

Midwest

Extremely low-income (0–30% AMI) 64.5 37.3 33.2

Very low-income (0–50% AMI) 122.8 73.8 66.4

Low-income (0–80% AMI) 139.8 100.0 91.7

South

Extremely low-income (0–30% AMI) 68.5 37.7 33.2

Very low-income (0–50% AMI) 89.3 55.4 49.1

Low-income (0–80% AMI) 125.8 91.7 82.4

West

Extremely low-income (0–30% AMI) 60.2 33.8 31.5

Very low-income (0–50% AMI) 71.1 45.1 40.7

Low-income (0–80% AMI) 109.0 78.6 71.7 AMI = Area Median Income.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Rental Stock by Metropolitan Location

A similar analysis of affordable housing supply based on metropolitan status showed market variation in 2023. Exhibit 2-11 shows that urban areas had the most severe shortages of affordable units for VLI renter households. The measures of affordability, availability, and

38 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS adequacy for each income group in central cities and urban suburbs were generally lower than the national summary values in exhibit 2-8.

Exhibit 2-11. Rental Housing Stock by Metropolitan Location and Income Category, 2023

Affordable,

Affordable and Available, and

Affordable Available Adequate

Housing Units per Housing Units Housing Units per

Metropolitan Location and 100 Renter per 100 Renter 100 Renter

Income Category Households Households Households

Central cities

Extremely low-income renters (0–30% AMI) 58.0 37.7 31.9

Very low-income renters (0–50% AMI) 87.2 57.9 49.9

Low-income renters (0–80% AMI) 123.1 91.3 80.7

Suburbs, urban

Extremely low-income renters (0–30% AMI) 52.3 30.9 27.9

Very low-income renters (0–50% AMI) 75.6 48.8 44.2

Low-income renters (0–80% AMI) 117.4 84.1 77.4

Suburbs, rural

Extremely low-income renters (0–30% AMI) 95.4 46.6 42.3

Very low-income renters (0–50% AMI) 124.3 72.0 66.2

Low-income renters (0–80% AMI) 135.2 97.7 90.8

Nonmetropolitan areas

Extremely low-income renters (0–30% AMI) 104.9 53.1 47.6

Very low-income renters (0–50% AMI) 145.2 81.1 72.0

Low-income renters (0–80% AMI) 141.6 100.2 89.7 AMI = Area Median Income.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

Rental housing stock in rural suburbs and nonmetropolitan areas was not as constrained as the stock for the nation as a whole. Nevertheless, exhibit 2-11 also highlights severe deficiencies in the availability and adequacy of affordable units in rural areas. Within urban areas, higher-

income renters occupied 34 to 35 percent of VLI-affordable units.59 In rural areas, that figure ranged from 42 to 44 percent, suggesting that higher-income renters consumed a larger share of the affordable housing stock in rural areas than those who live closer to city centers. This evidence disrupts the notion that the affordable housing crisis could be resolved simply by lower-income renters moving away from cities. The lack of affordable housing presents a mobility barrier for people who want to move for job opportunities or other reasons. Likewise, a greater share of units in rural areas had severe quality deficiencies, with 8 to 11 percent of available

—————————————————————————————————————— 59 That is, 29 of the 87 units affordable for every 100 VLI renter households in central cities are not available. The same is true for 27 of 76 affordable units in urban suburbs.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 39

VLI-affordable units inadequate.60 These problems are less prevalent in urban areas—affecting 9 to 14 percent of units affordable and available to VLI renters.

Summary

Worst case needs are commonplace in every region and metropolitan category across the United States. The national total of 8.46 million worst case needs in 2023 was distributed on a regional basis, with 3.17 million households in the South, followed by 2.29 million in the West, 1.48 million in the Northeast, and 1.53 million in the Midwest. Nationwide, 44.2 percent of VLI renters had worst case needs in 2023, a rate insignificantly lower than in 2021. Prevalence increased in the West and Midwest, with respective increases of 2 and 3 percent, and prevalence in both the South and Northeast regions has decreased by less than 1 percent each since 2021. Both the South and West maintained greater-than-average rates of worst case needs in 2023. Urban areas (urban suburbs and central cities) also had higher prevalence rates and were home to about 83 percent of worst case needs households.

Nationwide, 28.0 percent of VLI renters, or 5.37 million households, reported receiving housing assistance. For every VLI renter household assisted, another 1.6 renter households had worst case needs that could have been mitigated with such assistance.

Steady absorption of unoccupied rental housing stock has reduced overall vacancy rates to consistently less than 10 percent since 2011. With 93 rental units affordable for every 100 VLI renter households nationally, not all such households could find an affordable unit in 2023, even if allocations were perfect among households across the nation (that is, if the lowest rent units were allocated to the lowest income households first). Many fewer affordable units were actually available to renters with the lowest incomes because vacancy rates were lowest for the lowest rent units, and many affordable units were rented to higher-income families. In 2023, the vacancy rate was only 3.7 percent for units affordable at ELIs compared with 11.4 percent for units affordable at more than 80 percent of AMI. The slight expansion of rental stock to meet rental demand between 2021 and 2023 mostly benefited higher-income households, with fewer new units affordable to VLI renter households.

Because of competition for affordable units, when a simple ratio of affordable units per 100 VLI renter households was made more stringent by adding availability as a constraint, the ratio decreased from 93 affordable units to only 59 affordable and available units per 100 VLI renter households, and it decreased from 66 to 38 per 100 ELI renter households. Higher-income families occupied 41.6 percent of units affordable to ELI renter households.

In addition, a substantial proportion of available units are not in adequate physical condition. The number of affordable, available, and adequate units in 2023 was 52 per 100 VLI renter households and only 34 per 100 ELI renter households.

Given that the demand for affordable, available, and adequate units for the renters with the lowest incomes far outstrips supply, policy interventions which reduce the demand for rental housing are critically needed. Indeed, because the demand for housing is far more elastic than

—————————————————————————————————————— 60 Likewise, Divringi et al. (2019) found that aggregate repair costs were particularly high among single-family rental units, especially older units occupied by renters with incomes at or below the poverty line. Repair needs among those units accounted for about 20 percent of the aggregate estimated repair costs of all renter households in 2018. Those units are disproportionately clustered in nonmetropolitan areas.

40 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS supply, interventions that reduce housing demand may be a more feasible policy option than those that attempt to increase supply.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 41 Section 3. Understanding the Trend in Worst Case Needs

Section 2 demonstrated that worst case needs were prevalent across the nation because of the limited availability of adequate, affordable rental units relative to the number of very low-income (VLI) renter households who needed them. Section 3 elaborates on how the changes in the number of rental units, the number of renter households, and rental costs between 2021 and 2023 contributed to the prevalence of worst case needs.

Estimated worst case needs in 2023 are an insignificant 62,000 cases below the 2021 estimate. The analysis in this section attributes the lack of change in worst case needs to the interplay of demographic factors, such as household shifts from renting to homeownership, income gains for VLI households, and higher prevalence of assisted renters. These demographic factors offset the increase in worst case needs cases because of the ongoing formation of new households. However, unassisted VLI renters struggled to find affordable units where they live, as the prevalence of worst case needs marginally increased for this group between 2021 and 2023.

Drivers of Affordable Housing Demand

The previous sections of this report showed that the increase in the number of households with worst case needs reflects both changes in the population vulnerable to worst case needs— unassisted VLI renter households—and changes in the share of those renters experiencing the severe problems that trigger worst case needs. As this section will show, the population of vulnerable renters is primarily affected by demographic factors (including their incomes and, to a small extent, HUD’s categorization of their incomes). In turn, this population substantially determines the demand for affordable housing. By contrast, the current rate of worst case needs among these vulnerable renters reflects the economic response of the housing market dynamics to these demographic changes.

The following analysis sorts out the factors driving the most recent change in worst case needs. The analysis first distinguishes between the effects of population change and the prevalence of worst case needs to estimate their relative importance and then considers how various

demographic factors affected the population change.61

The population of unassisted VLI renters decreased by 420,000 households, or 3.0 percent, from 14.19 to 13.77 million between 2021 and 2023. The rate of worst case needs among unassisted VLI renters increased by 1.4 percentage points from 60.1 to 61.4 percent during this same period.

Based solely on the demographic decrease of unassisted VLI renters, one might expect to have recorded a net decrease of 258,000 cases of worst case needs. Because of the tight rental market, however, an estimated 196,000 unassisted VLI renters were unable to find affordable and

—————————————————————————————————————— 61 Any analysis of survey data faces limitations from both sampling error and nonsampling error. Such errors are compounded when multiple survey years are compared. This analysis takes the American Housing Survey estimates at face value, but the reader should recognize that multiple sources of potential error exist.

42 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS available units, increasing the prevalence rate of worst case needs and bringing the total net

decrease in worst case needs to 62,000 between 2021 and 2023.62

The 258,000 decrease in worst case needs resulting from demographic shifts can be further broken down into four components, illustrated by the first four columns of exhibit 3-1 and discussed in the following. The columns of this chart are cascading in the sense that each column begins where the previous one ends.

Exhibit 3-1. Factors Affecting Change in Worst Case Needs, 2019–23

—————————————————————————————————————— 62 The demographic effect equals the new prevalence rate times the numerical increase (or decrease) in renters, and the prevalence effect is the increase (or decrease) in the prevalence rate times the baseline number of renters. Appendix E provides additional detail about the shift-share decomposition approach and its limitations.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 43 VLI = very low-income.

Note: The columns of 3-1 are cascading in the sense that each column begins where the previous one ends, and the final column displays the net effect on worst case needs. Source: HUD Office of Policy Development and Research tabulations of America Housing Survey data

Household Formation. The nation added 4.73 million households between 2021 and 2023, explaining a proportional increase of 321,000 cases of worst case needs. The number of households increased by 3.7 percent during this 2-year period, exceeding biennial increases averaging 2.2 percent observed in the 2013 to 2021 American Housing Survey (AHS).

Renter Share of Households. A decline in renters’ share of households accounts for a reduction of worst case needs by 247,000 cases, as the 0.8-percent increase in renters fell behind the 3.7-percent increase in households overall. Correspondingly, the homeownership rate was 65.2 percent in 2023, marginally greater than the 64.2-percent rate in 2021. The 0.8-percent increase in renters is below biennial increases averaging 3.5 percent reported since 2013.

Renter Income Changes. Income losses and shifts in the income distribution affecting the VLI 63 category account for a 163,000-case decrease in worst case needs. The number of renters with incomes below the VLI threshold decreased by 198,000, or 1.0 percent, from 2021 to 2023, which included the ending of the COVID-19 pandemic and its economic disruption. The decrease is about the same as previous biennial changes averaging less than 1 percent since 2013, which includes two periods with significant decreases in VLI renters (exhibit A-13).

Rental Assistance Gap. Rental assistance increased in proportion to VLI renters from 2021 to 2023, so an improved rental assistance gap accounts for 169,000 fewer cases of worst case needs. The 2-year decrease of 3.0 percent in unassisted VLI renters exceeded the 1.0-percent reduction in VLI renters overall. By comparison, biennial decreases of unassisted VLI renters have averaged less than 1 percent since 2013.

The demographic factors summarized previously generated a net decrease in the population of unassisted VLI renters sufficient to decrease worst case needs by 258,000 between 2021 and 2023 in the absence of other factors. However, the housing market’s limited capacity to change the supply of VLI-affordable units has an additional effect on severe housing problems. The fifth column of exhibit 3-1, labeled “Market dynamics,” represents the extent to which the market responded to quantitative changes in demand for VLI-affordable rental units. The addition of more than 281,000 renter households with low incomes of 50 to 80 percent of Area Median Income (AMI) increased demand for both VLI-affordable and higher-rent housing stock (see exhibit A-13). Although the supply of VLI-affordable units marginally increased during this period, as the number of affordable and available units per 100 renters increased, the prevalence of worst case needs also increased among unassisted VLI renters. It is possible that the additional units were not in geographies where VLI renters needed them the most or that the additional units were not of adequate size compared with household sizes. In sum, market factors account

—————————————————————————————————————— 63 Stimulus payments and other forms of one-time income that were part of the federal response to the COVID-19 pandemic are not counted by AHS and may have lifted some households out of the VLI category. An additional potential methodological factor is summarized in the sidebar, “Changes in Income Limits and Worst Case Needs.”

44 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS for 196,000 cases of worst case needs, reducing the decrease of 258,000 cases explained by demographic factors alone.

An adequate market response to growing quantitative demand for affordable units would require increased construction of affordably priced units and reductions in rents (known as filtering down) of surplus or aging higher-rent units. The next section further explores such market factors.

Other Factors Affecting Affordable Housing Supply and Demand

As exhibit 2-9 previously showed, the availability of affordable rental units for VLI renters improved by 2.0 units per 100 renters between 2021 and 2023, and extremely low-income (ELI) renters experienced a gain of 2.1 available units per 100 renters from an already severely constrained market. Multiple demographic and market factors affect such affordability metrics.

Exhibit 3-2 examines the factors responsible for the change in the availability of affordable units. AHS data show that a net total of 191,000 rental units (less than 1 percent) were added between 2021 and 2023 (exhibit A-13). Other complementary data show that more than 590,000 unfurnished rental apartments were completed in 2021 and 2022, a substantially more robust

pace than seen during most of the past 2 decades.64 Even so, older units continued to be removed from the stock, and renter households continued to increase—by 387,000 between 2021 and 2023. Furthermore, added renter units tended not to be affordable and available for the numerous new ELI and VLI households. The median monthly rent of the newly completed units

in 2022 was $1,829,65 even when the number of affordable and available units increased by 3.1 percent for ELI renters and 2.5 percent for VLI renters (exhibit 3-2).

Exhibit 3-2. Changes in Affordable Rental Housing Availability by Income Category, 2021–23

Extremely Low- Very Low- Low-

Income Income Income (0–

Changes (0–30% AMI) (0–50% AMI) 80% AMI) Total a

Cumulative affordable and available rental units (thousands)

2021 4,480 10,969 26,989 50,074

2023 4,618 11,247 26,274 50,266

Percent change +3.1 +2.5 – 2.6 +0.4

Cumulative households (thousands)

2021 12,319 19,338 28,969 45,991

2023 12,017 19,140 29,052 46,378

Percent change – 2.5 – 1.0 +0.3 +0.8

Income limit (median, current dollars)

2021 21,960 34,150 54,600 —

2023 24,860 39,900 63,800 —

—————————————————————————————————————— 64 See U.S. Housing Market Conditions, “Unfurnished Rental Apartments–Completed.”

https://www.huduser.gov/portal/ushmc/hd_mul_fam.html. 65 See U.S. Housing Market Conditions, “Unfurnished Rental Apartments–Completed.”

https://www.huduser.gov/portal/ushmc/hd_mul_fam.html.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 45

Extremely Low- Very Low- Low-

Income Income Income (0–

Changes (0–30% AMI) (0–50% AMI) 80% AMI) Total a Percent change +13.2 +16.8 +16.8 —

Median household income (all renters, current dollars)

2021 — — — 41,000

2023 — — — 49,540

Percent change — — — +20.8

Median monthly housing cost (all renters, current dollars)

2021 — — — 1,184

2023 — — — 1,391

Percent change — — — +17.5 AMI = Area Median Income.

a Total represents all units or renters, not the sum of the cumulative income categories. Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

In 2023, as in most years, both supply and demand factors were influential in shaping the extent of worst case needs. Some of those trends are promising, and others reflect ongoing challenges. Median renter incomes increased by a nominal 20.8 percent between 2021 and 2023, reflecting substantial inflation pressures and strength in hiring after the pandemic and recovery from the brief 2020 recession. Such nominal growth masks the dimmer picture that, during the longer

period from 2019 to 2023, the real income of the median renter decreased by 3 percent.66 For such reasons, the fact that the nominal 20.8-percent increase in median renter income exceeds the 17.5-percent increase in median rent is not clearly positive for worst case needs (exhibit 3-2). Furthermore, a comparison of income groups shows that rents increased by an average of 19.7 percent for ELI households and 14.2 percent for those with incomes 30–50 percent of AMI, exceeding the mean rent increase of 16.1 percent for all renters (exhibit A-14).

For VLI renters as a group, mean rent increases of 17.0 percent between 2021 and 2023

surpassed their mean income increases of 12.6 percent (exhibit A-14).67 Indeed, because U.S.

households experienced 12.2-percent inflation from September 2021 to September 2023,68 their

real purchasing power decreased.69 HUD’s rental affordability index, based on inflation-adjusted dollars from non-AHS data, indicates a real decline in rental affordability between the third quarters of 2021 and 2023. The index, which is a ratio of median renter incomes and

—————————————————————————————————————— 66 The median annual income of renter households in the United States in real terms was $55,205 in the third quarter of 2019 and $53,466 in the third quarter of 2023. See U.S. Housing Market Conditions, “Rental Affordability.”

https://www.huduser.gov/portal/ushmc/hd_rai.html. 67 Those housing costs include rent, utilities, property insurance, land rent, and association fees but exclude any separate security deposit or parking fees.

68 The September dates correspond with the end of AHS data collection in those years. The Consumer Price Index for All Urban Consumers (CPI-U) began recording consistent price increases of 0.5 percent per month or more in February

2021. See U.S. Bureau of Labor Statistics: https://data.bls.gov/timeseries/CUUR0000SA0. 69 Real purchasing power decreased even beyond the inflation of housing costs. For the average urban consumer (including homeowners), shelter, energy services, utility services, and fuel oil, propane, kerosene, and firewood together

accounted for 62 percent of the CPI-U market basket in 2023. https://www.bls.gov/cpi/tables/supplemental-

files/home.htm.

46 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

median rents, worsened from 106.1 to 97.6 during this period.70 Increased housing cost burdens reflect the worsening availability of affordable units and explain why the prevalence of worst case needs increased even as the size of the VLI renter population decreased. The increase in prevalence occurred even though the subset of VLI renters with ELIs decreased slightly more, 2.5 percent, than the subset with incomes of 30–50 percent of AMI, 1.5 percent.

Changes in Income Limits and Worst Case Needs

A shift in income limits may explain a portion of the population change between 2021 and 2023 in renters with extremely low and very low incomes (ELI and VLI). HUD calculates income limits based on Area Median Family Incomes, which include both owners and renters, and then uses the income limits to define the boundaries of the extremely low-, very low-, and low-income categories.

Exhibit 3-2 shows that, across the nation, the income limits defining each income category increased roughly in proportion to increases in Area Median Income between 2021 and 2023. The greatest income qualifying as ELI for a four-person household increased by $950 to $55,750 in the San Francisco metropolitan area. The greatest income qualifying as VLI for a four-person household increased by $1,550 to $92,900. Such changes in high-cost areas substantially exceed the median changes in income limits shown in exhibit 3-2. As a result of the higher thresholds, additional households were captured within the ELI and VLI categories in 2023. The latter would have the effect of increasing the estimate of worst case needs.

In addition to increasing incomes, another element critical to reducing worst case needs over time is improving the access that VLI renters have to an adequate supply of affordable rental units, or the “availability” of such units. Exhibit 3-3 presents how the market for rental units affordable to VLI households has responded to demand trends during the past 10 years.

Exhibit 3-3. Trends in Housing Supply Mismatch and Worst Case Needs, 2013–23

——————————————————————————————————————

70 See U.S. Housing Market Conditions https://www.huduser.gov/portal/ushmc/hd_rai.html. The 2021 third quarter value reported here represents data collected after pandemic-related disruptions ended.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 47

ELI = extremely low-income. VLI = very low-income.

Source: HUD Office of Policy Development and Research tabulations of America Housing Survey data

Most years in which worst case needs increase are years in which the availability of affordable rental units for VLI renters decreases; yet, the experiences of the large and more vulnerable subset of ELI renters may be sufficient to drive overall changes. Between 2017 and 2019, increases in affordable and available units for VLI renters were not matched by greater availability for the ELI renters who faced greater challenges, so worst case needs changed little. Between 2021 and 2023, in contrast, both ELI and VLI renters experienced slightly looser rental markets and improved availability, yet not enough to significantly decrease worst case needs.

The effects of weak growth in the rental supply and strong competition for available rental units from higher-income renters continue to have the greatest effect on the availability of units affordable to renters with incomes at and below 30 percent of AMI. Although higher-income renters may be unlikely to compete for the units with the very cheapest rents because of quality deficiencies typical of such units, the competition for marginally higher tiers of units both reduces availability directly and causes rents to increase. Therefore, supplying a range of rental and homeownership options to households with both lower and higher incomes is important for reducing the level of worst case needs. The price of a home in the United States may be unattainable for ELI and VLI renters. Between 2021 and 2023, the average existing home was priced at more than $375,000, a new home at more than $400,000, and a manufactured home at more than $119,000. In addition, mortgage financing is a major barrier when the interest rate is

above 6 percent.71

—————————————————————————————————————— 71 See U.S. Housing Market Conditions, Finance and Investment Data—Advertised Mortgage Rates:

https://www.huduser.gov/portal/ushmc/fi_AdvMrtRte.html?indicator=R30YRFIX.

48 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Concluding Summary

In 2023, the number of worst case needs decreased insignificantly, subtracting 62,000 cases from the 2021 number to reach 8.46 million. An analysis decomposing demographic and market factors indicates that the demographic factors affecting the number of unassisted VLI renter households were sufficient to reduce worst case needs by 258,000 cases, but the inability of the tight rental market to meet the demand largely offset that decrease by contributing 196,000 cases.

Of the four demographic factors, national household formation, largely driven by record levels of immigration and a continued long-term decline in marriage rates, would have been expected to increase worst case needs by 321,000 cases. A shift from renting to homeownership diminished that effect by an estimated 247,000 cases. Improvement in renter incomes accounted for a further reduction of 163,000 cases.

The market response to such demand trends during the inflationary period between 2021 and 2023 was not sufficient to prevent the prevalence of worst case needs among VLI renters from increasing. Although the number of housing units per capita stands at record levels, as does annual production of new rental units, the net 187,000 rental units added to the housing stock between 2021 and 2023 fell far short of the 387,000 renter households added during the same period (exhibit A-13). Accordingly, even though the number of rental units affordable and available per 100 renters increased by 3.1 percent for ELI renters and 2.5 for VLI renters, the prevalence of worst case needs increased among those with incomes of 30 to 50 percent of AMI. Such metrics characterizing the national housing market do not reliably predict the effect on any given family’s well-being, which depends on local housing markets and individual financial situations as much as national conditions. For example, as median renter incomes increased by 20.8 percent, median rents increased by 17.5 percent, whereas inflation reduced the value of their dollars by 12.2 percent.

Worst case housing needs are a national problem with variations in severity across both demographic and geographic dimensions. The extent of severe housing problems affecting VLI renters in 2023 reflects the slow recovery of the brief recession caused by the distancing mandates during the onset of the COVID-19 pandemic, including losses of earnings and public interventions through income supports and housing initiatives. The 8.46 million cases of worst case needs in 2023 remain slightly below the peak of 8.53 million observed in 2021. The nation’s modest production of affordable rental units means that more than 6 of 10 ELI renter households and 4 of 10 VLI renter households did not have access to affordable and available housing units. In 2023, 1.6 VLI renter households with worst case needs existed for every VLI renter with rental assistance.

In the context of continuing inflation and other macroeconomic obstacles, comprehensive policy solutions are urgently needed to address the continuing challenge of worst case housing needs. Such policies must aim to stabilize the continuous rise in housing costs. Because housing demand is far more elastic than housing supply, solutions should consider a focus on moderating government-driven demand factors in addition to increasing supply.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 49 Appendix A. Detailed Data on Housing Problems and Supply of Affordable Housing

Contents

Exhibit A-1A. Housing Conditions of Renter Households by Relative Income, 2021 and 2023

Exhibit A-1B. Housing Conditions of Owner Households by Relative Income, 2021 and 2023

Exhibit A-2A. Housing Conditions of Renters and Owners, 2001–2023—Number of Households

Exhibit A-2B. Housing Conditions of Renters and Owners, 2001–2023—Percentage of Households

Exhibit A-3. Housing Conditions of Unassisted Renter Households by Relative Income, 2021 and 2023

Exhibit A-4. Prevalence of Housing Problems Among Renters by Relative Income, 2021 and 2023

Exhibit A-5A. Prevalence of Housing Problems Among Very Low-Income Renters by Household Type, 2021 and 2023

Exhibit A-5B. Prevalence of Housing Problems Among Very Low-Income Renter Households Containing People with Disabilities by Household Type, 2021 and 2023

Exhibit A-6A. Housing Problems and Characteristics of Very Low-Income Renters by Household Type, 2023

Exhibit A-6B. Housing Problems and Characteristics of Extremely Low-Income Renters by Household Type, 2023

Exhibit A-7. Housing Problems and Characteristics of Very Low-Income Worst Case Renters by Household Type, 2023

Exhibit A-8. Housing Problems and Characteristics of Extremely Low-Income Worst Case Renters by Household Type, 2023

Exhibit A-9. Prevalence of Housing Problems Among Very Low-Income Renters by Race and Ethnicity, 2021 and 2023—Number and Percentage

Exhibit A-10. Prevalence of Housing Problems Among Very Low-Income Renters by Region, 2021 and 2023—Number and Percentage

Exhibit A-11A. Prevalence of Housing Problems Among Very Low-Income Renters by Metropolitan Location, 2021 and 2023—Number and Percentage

Exhibit A-11B. Housing Conditions of Renter Households by Relative Income, Sampled Metropolitan Areas, 2021 and 2023

Exhibit A-12. Households Occupying Rental Units by Affordability of Rent and Income of Occupants, 2021 and 2023

Exhibit A-13. Renters and Rental Units Affordable and Available to Them by Relative Income, 2001–2023

50 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-14. Average Income and Average Gross Rent of Renter Households by Relative Income, 2021 and 2023

Exhibit A-15. Housing Conditions of Households Having People Younger Than 62 Who Have Disabilities by Disability Type, 2021 and 2023

The U.S. Census Bureau reviewed this data product for unauthorized disclosure of confidential information and approved the disclosure avoidance practices applied to this release. CBDRB‑FY24‑0483.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 51 Exhibit A-1A. Housing Conditions of Renter Households by Relative Income, 2021 and 2023

Household Income as Percentage of HUD Area Median Family

Conditions Income

All

2023 0–30% > 30–50% > 50–80% > 80–120% > 120% Incomes

Total households

(thousands) 12,017 7,123 9,912 8,429 8,897 46,378

Unassisted with severe

problems 5,808 2,656 1,202 394 207 10,267

Unassisted with

nonsevere problems only 903 2,617 4,305 2,209 942 10,976

Unassisted with no

problems 1,022 768 3,627 5,455 7,453 18,325

Assisted 4,284 1,082 779 371 294 6,810

Any with severe

problems 8,002 2,845 1,279 416 209 12,751

Rent burden > 50% of

income 7,782 2,752 1,137 294 116 12,081

Severely inadequate

housing 467 146 162 122 93 990

Any with nonsevere

problems only 1,937 3,138 4,567 2,297 971 12,910

Rent burden > 30–50% of

income 1,681 2,955 4,046 1,859 458 10,999

Moderately inadequate

housing 292 281 476 368 372 1,789

Crowded housing 229 157 334 151 179 1,050

Any with no problems 2,079 1,139 4,066 5,716 7,716 20,716

All

2021 0–30% > 30–50% > 50–80% > 80–120% > 120% Incomes

Total households

(thousands) 12,319 7,019 9,631 7,775 9,247 45,991

Unassisted with severe

problems 6,051 2,475 1,105 324 266 10,221

Unassisted with

nonsevere problems only 1,031 2,711 4,386 1,890 931 10,949

Unassisted with no

problems 1,148 778 3,534 5,173 7,813 18,446

Assisted 4,089 1,055 606 388 236 6,374

Any with severe

problems 7,920 2,669 1,160 348 273 12,370

Rent burden > 50% of

income 7,708 2,547 975 256 142 11,628

52 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Household Income as Percentage of HUD Area Median Family

Conditions Income

All

2023 0–30% > 30–50% > 50–80% > 80–120% > 120% Incomes

Severely inadequate

housing 493 173 213 102 132 1,113

Any with nonsevere

problems only 2,140 3,200 4,611 1,963 970 12,884

Rent burden > 30–50% of

income 1,808 3,028 4,058 1,464 515 10,873

Moderately inadequate

housing 392 311 480 418 355 1,956

Crowded housing 281 213 372 152 133 1,151

Any with no problems 2,260 1,150 3,860 5,464 8,004 20,738 Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 53 Exhibit A-1B. Housing Conditions of Owner Households by Relative Income, 2021 and 2023

Conditions Household Income as Percentage of HUD Area Median Family

Income

2023 > 30– > 50– > 80– All 0–30% 50% 80% 120% > 120% Incomes

Total households

(thousands) 9,714 7,211 13,326 17,918 38,683 86,852

Unassisted with severe

problems 6,190 2,054 1,819 977 705 11,745

Unassisted with nonsevere

problems only 1,771 2,373 3,771 3,700 3,002 14,617

Unassisted with no problems 1,752 2,784 7,736 13,242 34,975 60,489

Any with severe problems 6,190 2,054 1,819 977 705 11,745

Cost burden > 50% of income 6,104 1,970 1,716 873 567 11,230

Severely inadequate housing 208 94 116 106 139 663

Any with nonsevere

problems only 1,771 2,373 3,771 3,700 3,002 14,617

Cost burden > 30–50% of

income 1,564 2,216 3,372 3,229 2,088 12,469

Moderately inadequate

housing 221 178 322 378 762 1,861

Crowded housing 127 40 205 206 251 829

Any with no problems 1,752 2,784 7,736 13,242 34,975 60,489

2021 > 30– > 50– > 80– All 0–30% 50% 80% 120% > 120% Incomes

Total households

(thousands) 8,997 6,777 12,575 14,982 39,183 82,514

Unassisted with severe

problems 5,720 1,882 1,583 768 679 10,632

Unassisted with nonsevere

problems only 1,602 2,260 3,661 3,170 2,901 13,594

Unassisted with no problems 1,674 2,636 7,331 11,043 35,603 58,287

Any with severe problems 5,720 1,882 1,583 768 679 10,632

Cost burden > 50% of income 5,592 1,841 1,464 660 518 10,075

Severely inadequate housing 254 58 135 109 164 720

Any with nonsevere

problems only 1,602 2,260 3,661 3,170 2,901 13,594

Cost burden > 30–50% of

income 1,429 2,102 3,240 2,758 2,024 11,553

Moderately inadequate

housing 191 188 310 338 717 1,744

Crowded housing 116 49 234 168 235 802

Any with no problems 1,674 2,636 7,331 11,043 35,603 58,287 Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

54 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-2A. Housing Conditions of Renters and Owners, 2001–23—Number of Households

Conditions 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023

Total households (thousands) 105,435 105,868 108,901 110,719 111,861 115,076 116,032 118,290 121,560 124,135 128,504 133,231

Unassisted with severe problems 13,494 13,398 16,142 16,944 19,259 20,717 18,553 18,000 18,594 18,978 20,854 22,014

Unassisted with nonsevere problems only 19,217 19,790 20,849 22,752 23,225 24,079 22,153 21,672 23,633 23,593 24,543 25,592

Unassisted with no problems 66,445 66,468 65,362 65,862 64,506 64,983 69,796 73,059 72,945 75,400 76,732 78,814

Assisted 6,279 6,211 6,547 5,161 4,871 5,298 5,530 5,559 6,388 6,164 6,374 6,811

Cost burden > 50% of income 13,330 13,188 16,433 17,140 19,458 20,781 18,810 18,799 19,724 19,849 21,702 23,311

Cost burden > 30–50% of income 16,923 17,856 19,403 21,153 21,818 22,369 20,884 19,252 21,606 21,676 22,425 23,467

Severely inadequate housing 2,108 1,971 2,023 1,805 1,866 2,126 1,942 1,500 1,343 1,458 1,833 1,652

Moderately inadequate housing 4,504 4,311 4,177 3,954 3,884 3,133 3,946 3,907 3,568 3,449 3,701 3,650

Crowded housing 2,631 2,559 2,621 2,529 2,509 1,923 2,509 1,803 1,951 1,840 1,952 1,877

Renter households (thousands) 33,727 33,614 33,951 35,054 35,396 38,867 40,273 43,930 43,993 44,660 45,991 46,378

Unassisted with severe problems 5,758 5,887 6,860 6,993 8,085 9,548 8,874 9,651 9,198 9,352 10,222 10,268

Unassisted with nonsevere problems only 7,283 7,557 7,303 8,445 8,229 9,194 9,233 10,455 10,181 10,225 10,949 10,975

Unassisted with no problems 14,407 13,958 13,240 14,455 14,211 14,828 16,636 18,265 18,226 18,919 18,445 18,325

Assisted 6,279 6,211 6,547 5,161 4,871 5,298 5,530 5,559 6,388 6,164 6,374 6,811

Cost burden > 50% of income 6,412 6,477 7,891 7,793 9,000 10,391 9,744 10,988 10,757 10,738 11,627 12,081

Cost burden > 30–50% of income 6,916 7,468 7,502 8,340 8,240 9,124 9,292 10,118 10,215 10,291 10,873 10,999

Severely inadequate housing 1,168 1,038 1,100 1,073 998 1,204 1,155 828 826 816 1,112 989

Moderately inadequate housing 2,508 2,525 2,542 2,400 2,264 1,830 2,508 2,027 1,708 1,730 1,956 1,789

Crowded housing 1,658 1,615 1,635 1,511 1,499 1,072 1,652 1,120 1,245 1,106 1,151 1,049

Owner households (thousands) 71,708 72,254 74,950 75,665 76,465 76,209 75,759 74,360 77,567 79,475 82,513 86,853

Unassisted with severe problems 7,736 7,511 9,282 9,951 11,174 11,169 9,679 8,349 9,396 9,626 10,632 11,746

Unassisted with nonsevere problems only 11,934 12,233 13,546 14,307 14,996 14,885 12,920 11,217 13,452 13,368 13,594 14,617

Unassisted with no problems 52,038 52,510 52,122 51,407 50,295 50,155 53,160 54,794 54,719 56,481 58,287 60,489

Cost burden > 50% of income 6,918 6,711 8,542 9,347 10,458 10,390 9,066 7,811 8,967 9,111 10,075 11,230

Cost burden > 30–50% of income 10,007 10,388 11,901 12,813 13,578 13,245 11,592 9,135 11,391 11,385 11,552 12,468

Severely inadequate housing 940 933 923 732 868 922 787 673 517 642 721 663

Moderately inadequate housing 1,996 1,786 1,635 1,554 1,620 1,303 1,438 1,881 1,860 1,719 1,745 1,861

Crowded housing 973 944 986 1,018 1,010 851 857 683 706 734 801 828 Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 55

Exhibit A-2B. Housing Conditions of Renters and Owners, 2001–23—Percentage of Households

Conditions 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023

Total households 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Unassisted with severe problems 12.8 12.7 14.8 15.3 17.2 18.0 16.0 15.2 15.3 15.3 16.2 16.5

Unassisted with nonsevere problems only 18.2 18.7 19.1 20.5 20.8 20.9 19.1 18.3 19.4 19.0 19.1 19.2

Unassisted with no problems 63.0 62.8 60.0 59.5 57.7 56.5 60.2 61.8 60.0 60.7 59.7 59.2

Assisted 6.0 5.9 6.0 4.7 4.4 4.6 4.8 4.7 5.3 5.0 5.0 5.1

Cost burden > 50% of income 12.6 12.5 15.1 15.5 17.4 18.1 16.2 15.9 16.2 16.0 16.9 17.5

Cost burden > 30–50% of income 16.1 16.9 17.8 19.1 19.5 19.4 18.0 16.3 17.8 17.5 17.5 17.6

Severely inadequate housing 2.0 1.9 1.9 1.6 1.7 1.8 1.7 1.3 1.1 1.2 1.4 1.2

Moderately inadequate housing 4.3 4.1 3.8 3.6 3.5 2.7 3.4 3.3 2.9 2.8 2.9 2.7

Crowded housing 2.5 2.4 2.4 2.3 2.2 1.7 2.2 1.5 1.6 1.5 1.5 1.4

Renter households 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Unassisted with severe problems 17.1 17.5 20.2 19.9 22.8 24.6 22.0 22.0 20.9 20.9 22.2 22.1

Unassisted with nonsevere problems only 21.6 22.5 21.5 24.1 23.2 23.7 22.9 23.8 23.1 22.9 23.8 23.7

Unassisted with no problems 42.7 41.5 39.0 41.2 40.1 38.2 41.3 41.6 41.4 42.4 40.1 39.5

Assisted 18.6 18.5 19.3 14.7 13.8 13.6 13.7 12.7 14.5 13.8 13.9 14.7

Cost burden > 50% of income 19.0 19.3 23.2 22.2 25.4 26.7 24.2 25.0 24.5 24.0 25.3 26.0

Cost burden > 30–50% of income 20.5 22.2 22.1 23.8 23.3 23.5 23.1 23.0 23.2 23.0 23.6 23.7

Severely inadequate housing 3.5 3.1 3.2 3.1 2.8 3.1 2.9 1.9 1.9 1.8 2.4 2.1

Moderately inadequate housing 7.4 7.5 7.5 6.8 6.4 4.7 6.2 4.6 3.9 3.9 4.3 3.9

Crowded housing 4.9 4.8 4.8 4.3 4.2 2.8 4.1 2.6 2.8 2.5 2.5 2.3

Owner households 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Unassisted with severe problems 10.8 10.4 12.4 13.2 14.6 14.7 12.8 11.2 12.1 12.1 12.9 13.5

Unassisted with nonsevere problems only 16.6 16.9 18.1 18.9 19.6 19.5 17.1 15.1 17.3 16.8 16.5 16.8

Unassisted with no problems 72.6 72.7 69.5 67.9 65.8 65.8 70.2 73.7 70.5 71.1 70.6 69.6

Cost burden > 50% of income 9.6 9.3 11.4 12.4 13.7 13.6 12.0 10.5 11.6 11.5 12.2 12.9

Cost burden > 30–50% of income 14.0 14.4 15.9 16.9 17.8 17.4 15.3 12.3 14.7 14.3 14.0 14.4

Severely inadequate housing 1.3 1.3 1.2 1.0 1.1 1.2 1.0 0.9 0.7 0.8 0.9 0.8

Moderately inadequate housing 2.8 2.5 2.2 2.1 2.1 1.7 1.9 2.5 2.4 2.2 2.1 2.1

Crowded housing 1.4 1.3 1.3 1.3 1.3 1.1 1.1 0.9 0.9 0.9 1.0 1.0 Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey

56 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-3. Housing Conditions of Unassisted Renter Households by Relative Income, 2021 and 2023

Household Income as Percentage of HUD Area Median Family

Conditions Income

> 30– > 50– > 80– All

2023 0–30% 50% 80% 120% > 120% Incomes

Total unassisted households

(thousands) 7,734 6,041 9,133 8,058 8,602 39,568

Any with severe problems 5,808 2,656 1,202 394 207 10,267

Rent burden > 50% of income 5,701 2,591 1,093 280 115 9,780

[Rent above FMR] 2,280 1,617 862 268 115 5,142

Severely inadequate housing 279 115 129 114 92 729

Any with nonsevere problems

only 903 2,617 4,305 2,209 942 10,976

Rent burden > 30–50% of income 768 2,480 3,834 1,798 447 9,327

Moderately inadequate housing 118 230 420 345 358 1,471

Crowded housing 206 128 311 144 169 958

Any with no problems 1,022 768 3,627 5,455 7,453 18,325

> 30– > 50– > 80– All

2021 0–30% 50% 80% 120% > 120% Incomes

Total unassisted households

(thousands) 8,230 5,964 9,025 7,387 9,010 39,616

Any with severe problems 6,051 2,475 1,105 324 266 10,221

Rent burden > 50% of income 5,915 2,373 938 239 141 9,606

[Rent above FMR] 2,099 1,432 761 228 141 4,661

Severely inadequate housing 331 150 189 95 125 890

Any with nonsevere problems

only 1,031 2,711 4,386 1,890 931 10,949

Rent burden > 30–50% of income 844 2,590 3,886 1,416 499 9,235

Moderately inadequate housing 232 247 452 402 341 1,674

Crowded housing 195 196 333 140 122 986

Any with no problems 1,148 778 3,534 5,173 7,813 18,446 FMR = Fair Market Rent.

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 57

Exhibit A-4. Prevalence of Housing Problems Among Renters by Relative Income, 2021 and 2023

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Renter households (thousands) 45,991 46,378 100.0 100.0

Unassisted with severe problems 10,221 10,267 22.2 22.1

Unassisted with nonsevere problems only 10,949 10,976 23.8 23.7

Unassisted with no problems 18,446 18,325 40.1 39.5

Assisted 6,374 6,810 13.9 14.7

Any with severe problems 12,370 12,751 26.9 27.5

Rent burden > 50% of income 11,628 12,081 25.3 26.0

Severely inadequate housing 1,113 990 2.4 2.1

[Rent burden only] 10,455 10,947 22.7 23.6

Any with nonsevere problems only 12,884 12,910 28.0 27.8

Rent burden > 30–50% of income 10,873 10,999 23.6 23.7

Moderately inadequate housing 1,956 1,789 4.3 3.9

Crowded housing 1,151 1,050 2.5 2.3

[Rent burden only] 9,867 10,140 21.5 21.9

Any with no problems 20,738 20,716 45.1 44.7

Income 0–30% HAMFI (thousands) 12,319 12,017 100.0 100.0

Unassisted with severe problems 6,051 5,808 49.1 48.3

Unassisted with nonsevere problems only 1,031 903 8.4 7.5

Unassisted with no problems 1,148 1,022 9.3 8.5

Assisted 4,089 4,284 33.2 35.6

Any with severe problems 7,920 8,002 64.3 66.6

Rent burden > 50% of income 7,708 7,782 62.6 64.8

Severely inadequate housing 493 467 4.0 3.9

[Rent burden only] 6,834 6,981 55.5 58.1

Any with nonsevere problems only 2,140 1,937 17.4 16.1

Rent burden > 30–50% of income 1,808 1,681 14.7 14.0

Moderately inadequate housing 392 292 3.2 2.4

Crowded housing 281 229 2.3 1.9

[Rent burden only] 1,499 1,440 12.2 12.0

Any with no problems 2,260 2,079 18.3 17.3

Income > 30–50% HAMFI (thousands) 7,019 7,123 100.0 100.0

Unassisted with severe problems 2,475 2,656 35.3 37.3

Unassisted with nonsevere problems only 2,711 2,617 38.6 36.7

58 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Unassisted with no problems 778 768 11.1 10.8

Assisted 1,055 1,082 15.0 15.2

Any with severe problems 2,669 2,845 38.0 39.9

Rent burden > 50% of income 2,547 2,752 36.3 38.6

Severely inadequate housing 173 146 2.5 2.0

[Rent burden only] 2,370 2,518 33.8 35.4

Any with nonsevere problems only 3,200 3,138 45.6 44.1

Rent burden > 30–50% of income 3,028 2,955 43.1 41.5

Moderately inadequate housing 311 281 4.4 3.9

Crowded housing 213 157 3.0 2.2

[Rent burden only] 2,690 2,718 38.3 38.2

Any with no problems 1,150 1,139 16.4 16.0

Income > 50–80% HAMFI (thousands) 9,631 9,912 100.0 100.0

Unassisted with severe problems 1,105 1,202 11.5 12.1

Unassisted with nonsevere problems only 4,386 4,305 45.5 43.4

Unassisted with no problems 3,534 3,627 36.7 36.6

Assisted 606 779 6.3 7.9

Any with severe problems 1,160 1,279 12.0 12.9

Rent burden >50% of income 975 1,137 10.1 11.5

Severely inadequate housing 213 162 2.2 1.6

[Rent burden only] 882 1,063 9.2 10.7

Any with nonsevere problems only 4,611 4,567 47.9 46.1

Rent burden > 30–50% of income 4,058 4,046 42.1 40.8

Moderately inadequate housing 480 476 5.0 4.8

Crowded housing 372 334 3.9 3.4

[Rent burden only] 3,785 3,761 39.3 37.9

Any with no problems 3,860 4,066 40.1 41.0

Income > 80–120% HAMFI (thousands) 7,775 8,429 100.0 100.0

Unassisted with severe problems 324 394 4.2 4.7

Unassisted with nonsevere problems only 1,890 2,209 24.3 26.2

Unassisted with no problems 5,173 5,455 66.5 64.7

Assisted 388 371 5.0 4.4

Any with severe problems 348 416 4.5 4.9

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 59

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Rent burden > 50% of income 256 294 3.3 3.5

Severely inadequate housing 102 122 1.3 1.4

[Rent burden only] 244 284 3.1 3.4

Any with nonsevere problems only 1,963 2,297 25.2 27.3

Rent burden > 30–50% of income 1,464 1,859 18.8 22.1

Moderately inadequate housing 418 368 5.4 4.4

Crowded housing 152 151 2.0 1.8

[Rent burden only] 1,405 1,789 18.1 21.2

Any with no problems 5,464 5,716 70.3 67.8

Income > 120% HAMFI (thousands) 9,247 8,897 100.0 100.0

Unassisted with severe problems 266 207 2.9 2.3

Unassisted with nonsevere problems only 931 942 10.1 10.6

Unassisted with no problems 7,813 7,453 84.5 83.8

Assisted 236 294 2.6 3.3

Any with severe problems 273 209 3.0 2.3

Rent burden > 50% of income 142 116 1.5 1.3

Severely inadequate housing 132 93 1.4 1.0

[Rent burden only] 125 101 1.4 1.1

Any with nonsevere problems only 970 971 10.5 10.9

Rent burden > 30–50% of income 515 458 5.6 5.1

Moderately inadequate housing 355 372 3.8 4.2

Crowded housing 133 179 1.4 2.0

[Rent burden only] 488 432 5.3 4.9

Any with no problems 8,004 7,716 86.6 86.7 HAMFI = HUD Area Median Family Income.

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

60 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-5A. Prevalence of Housing Problems Among Very Low-Income Renters by Household Type, 2021 and 2023

Number Number Percentage Percentage

Household Type 2021 2023 2021 2023

All household types (thousands) 19,337 19,141 100.0 100.0

Older adults without children

(thousands) 5,858 6,345 100.0 100.0

Unassisted with severe problems 2,349 2,462 40.1 38.8

Unassisted with nonsevere problems only 805 916 13.7 14.4

Unassisted with no problems 566 532 9.7 8.4

Assisted 2,138 2,434 36.5 38.4

Any with severe problems 3,131 3,441 53.4 54.2

Rent burden > 50% of income 3,066 3,343 52.3 52.7

Severely inadequate housing 145 160 2.5 2.5

[Rent burden only] 2,757 3,050 47.1 48.1

Any with nonsevere problems only 1,472 1,669 25.1 26.3

Rent burden > 30–50% of income 1,399 1,563 23.9 24.6

Moderately inadequate housing 162 159 2.8 2.5

Crowded housing (D) 9 (D) 0.1

[Rent burden only] 1,302 1,500 22.2 23.6

Any with no problems 1,255 1,234 21.4 19.4

Families with children (thousands) 5,923 5,439 100.0 100.0

Unassisted with severe problems 2,629 2,333 44.4 42.9

Unassisted with nonsevere problems only 1,417 1,337 23.9 24.6

Unassisted with no problems 465 475 7.9 8.7

Assisted 1,412 1,294 23.8 23.8

Any with severe problems 3,250 2,993 54.9 55.0

Rent burden > 50% of income 3,118 2,931 52.6 53.9

Severely inadequate housing 251 167 4.2 3.1

[Rent burden only] 2,772 2,589 46.8 47.6

Any with nonsevere problems only 1,868 1,690 31.5 31.1

Rent burden > 30–50% of income 1,607 1,465 27.1 26.9

Moderately inadequate housing 246 208 4.2 3.8

Crowded housing 462 372 7.8 6.8

[Rent burden only] 1,200 1,152 20.3 21.2

Any with no problems 805 756 13.6 13.9

Other family households (thousands) 1,837 1,675 100.0 100.0

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 61

Number Number Percentage Percentage

Household Type 2021 2023 2021 2023

Unassisted with severe problems 918 874 50.0 52.2

Unassisted with nonsevere problems only 398 331 21.7 19.8

Unassisted with no problems 208 165 11.3 9.9

Assisted 313 305 17.0 18.2

Any with severe problems 1,065 1,035 58.0 61.8

Rent burden > 50% of income 1,034 1,005 56.3 60.0

Severely inadequate housing 74 88 4.0 5.3

[Rent burden only] 920 883 50.1 52.7

Any with nonsevere problems only 492 405 26.8 24.2

Rent burden > 30–50% of income 455 390 24.8 23.3

Moderately inadequate housing 69 38 3.8 2.3

Crowded housing 21 5 1.1 0.3

[Rent burden only] 406 363 22.1 21.7

Any with no problems 280 234 15.2 14.0

Other nonfamily households

(thousands) 5,719 5,682 100.0 100.0

Unassisted with severe problems 2,629 2,795 46.0 49.2

Unassisted with nonsevere problems only 1,120 936 19.6 16.5

Unassisted with no problems 688 617 12.0 10.9

Assisted 1,282 1,333 22.4 23.5

Any with severe problems 3,142 3,377 54.9 59.4

Rent burden > 50% of income 3,038 3,254 53.1 57.3

Severely inadequate housing 195 197 3.4 3.5

[Rent burden only] 2,754 2,976 48.2 52.4

Any with nonsevere problems only 1,508 1,310 26.4 23.1

Rent burden > 30–50% of income 1,375 1,218 24.0 21.4

Moderately inadequate housing 226 168 4.0 3.0

Crowded housing (D) 0 (D) 0.0

[Rent burden only] 1,281 1,142 22.4 20.1

Any with no problems 1,069 994 18.7 17.5 (D) = value suppressed in accordance with U.S. Census Bureau disclosure prevention requirements. Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

62 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-5B. Prevalence of Housing Problems Among Very Low-Income Renter Households Containing People with Disabilities* by Household Type, 2021 and 2023

Number Number Percentage Percentage

Household Type 2021 2023 2021 2023

All household types (thousands) 3,359 3,143 100.0 100.0

Older adults without children 154 100.0 100.0 (thousands) 160

Unassisted with severe problems 77 57 48.1 37.0

Unassisted with nonsevere problems only 34 32 21.3 20.8

Unassisted with no problems 15 6 9.4 3.9

Assisted 34 59 21.3 38.3

Any with severe problems 87 71 54.4 46.1

Rent burden > 50% of income 86 68 53.8 44.2

Severely inadequate housing 15 8 9.4 5.2

[Rent burden only] 66 62 41.3 40.3

Any with nonsevere problems only 50 64 31.3 41.6

Rent burden > 30–50% of income 49 43 30.6 27.9

Moderately inadequate housing 12 23 7.5 14.9

Crowded housing (D) (D) (D) (D)

[Rent burden only] 37 41 23.1 26.6

Any with no problems 23 19 14.4 12.3

Families with children (thousands) 1,056 940 100.0 100.0

Unassisted with severe problems 389 345 36.8 36.7

Unassisted with nonsevere problems only 206 196 19.5 20.9

Unassisted with no problems 78 64 7.4 6.8

Assisted 383 335 36.3 35.6

Any with severe problems 555 500 52.6 53.2

Rent burden > 50% of income 527 489 49.9 52.0

Severely inadequate housing 58 33 5.5 3.5

[Rent burden only] 429 401 40.6 42.7

Any with nonsevere problems only 330 306 31.3 32.6

Rent burden > 30–50% of income 273 244 25.9 26.0

Moderately inadequate housing 68 75 6.4 8.0

Crowded housing 83 53 7.9 5.6

[Rent burden only] 196 190 18.6 20.2

Any with no problems 170 134 16.1 14.3

Other family households (thousands) 514 448 100.0 100.0

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 63

Number Number Percentage Percentage

Household Type 2021 2023 2021 2023

Unassisted with severe problems 231 175 44.9 39.1

Unassisted with nonsevere problems only 86 77 16.7 17.2

Unassisted with no problems 55 58 10.7 12.9

Assisted 142 138 27.6 30.8

Any with severe problems 294 238 57.2 53.1

Rent burden > 50% of income 284 227 55.3 50.7

Severely inadequate housing 36 52 7.0 11.6

[Rent burden only] 238 160 46.3 35.7

Any with nonsevere problems only 120 107 23.3 23.9

Rent burden > 30–50% of income 112 101 21.8 22.5

Moderately inadequate housing 21 8 4.1 1.8

Crowded housing 10 (D) 1.9 (D)

[Rent burden only] 93 98 18.1 21.9

Any with no problems 100 103 19.5 23.0

Other nonfamily households

(thousands) 1,629 1,601 100.0 100.0

Unassisted with severe problems 560 585 34.4 36.5

Unassisted with nonsevere problems only 254 181 15.6 11.3

Unassisted with no problems 81 109 5.0 6.8

Assisted 735 726 45.1 45.3

Any with severe problems 831 844 51.0 52.7

Rent burden > 50% of income 783 807 48.1 50.4

Severely inadequate housing 93 78 5.7 4.9

[Rent burden only] 673 656 41.3 41.0

Any with nonsevere problems only 491 420 30.1 26.2

Rent burden > 30–50% of income 428 372 26.3 23.2

Moderately inadequate housing 90 72 5.5 4.5

Crowded housing (D) 0 (D) 0.0

[Rent burden only] 401 348 24.6 21.7

Any with no problems 307 338 18.8 21.1 (D) = value suppressed in accordance with U.S. Census Bureau disclosure prevention requirements. * Older adults with disabilities were excluded.

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

64 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-6A. Housing Problems and Characteristics of Very Low-Income Renters by Household Type, 2023

Older Families Other

Characteristics Adults, No With Other Nonfamily

Total Children Children Families Households

Renter households (thousands) 19,141 6,345 5,439 1,675 5,682

Number of children 10,546 NA 10,546 NA NA

Number of persons 39,687 8,066 20,629 4,209 6,783

Children/household 1.94 NA 1.94 NA NA

Persons/household 2.07 1.27 3.79 2.51 1.19

Unassisted with severe problems 8,464 2,462 2,333 874 2,795

Unassisted with nonsevere problems only 3,520 916 1,337 331 936

Unassisted with no problems 1,789 532 475 165 617

Assisted 5,366 2,434 1,294 305 1,333

Any with severe problems 10,846 3,441 2,993 1,035 3,377

Rent burden > 50% of income 10,533 3,343 2,931 1,005 3,254

Severely inadequate housing 612 160 167 88 197

[Rent burden only] 9,498 3,050 2,589 883 2,976

Any with nonsevere problems only 5,074 1,669 1,690 405 1,310

Rent burden > 30–50% of income 4,636 1,563 1,465 390 1,218

Moderately inadequate housing 573 159 208 38 168

Crowded housing 386 9 372 5 0

[Rent burden only] 4,157 1,500 1,152 363 1,142

Any with no problems 3,218 1,234 756 234 994

Other characteristics 19,141 6,345 5,439 1,675 5,682

One person in household 9,771 4,930 NA NA 4,841

Two-spouse household 3,361 788 1,951 622 NA

Female householder 11,946 4,186 3,777 1,016 2,967

Non-White Householder 10,972 2,820 3,906 1,091 3,155

Welfare/SSI income 3,651 1,381 1,026 338 906

Social Security income 5,652 4,695 380 145 432

Income below 50% poverty 4,423 1,311 1,300 316 1,496

Income below poverty 9,586 3,046 2,983 732 2,825

Income below 150% of poverty 14,249 4,653 4,567 1,183 3,846

High school graduate 14,686 4,812 3,901 1,209 4,764

2+ years post-high school 4,629 1,511 1,017 387 1,714

Earnings at minimum wage: At least half time 8,471 768 3,694 1,152 2,857

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 65

Earnings at minimum wage: At least full time 7,278 545 3,323 976 2,434

Earnings main source of income 9,023 702 3,830 1,206 3,285

Housing rated poor 1,163 278 366 159 360

Housing rated good+ 14,243 5,110 3,869 1,192 4,072

Neighborhood rated poor 1,266 258 460 137 411

Neighborhood rated good+ 14,227 5,101 3,854 1,205 4,067

In central cities 8,904 2,860 2,347 767 2,930

Suburbs, urban 6,366 2,143 1,907 618 1,698

Suburbs, rural 1,653 524 565 105 459

Nonmetropolitan 2,217 818 619 185 595

Northeast 3,979 1,506 1,111 332 1,030

Midwest 3,947 1,382 971 265 1,329

South 6,774 2,033 2,017 585 2,139

West 4,440 1,424 1,340 492 1,184 NA = not applicable. SSI = Supplemental Security Income.

(D) = value suppressed in accordance with U.S. Census Bureau disclosure prevention requirements. Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

66 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-6B. Housing Problems and Characteristics of Extremely Low-Income Renters by Household Type, 2023

Older Families Other

Characteristics Adults, No With Other Nonfamily

Total Children Children Families Households

Renter households (thousands) 12,018 4,297 3,351 932 3,438

Number of children 6,824 NA 6,824 NA NA

Number of persons 24,491 5,284 12,885 2,359 3,963

Children/household 2.04 NA 2.04 NA NA

Persons/household 2.04 1.23 3.85 2.53 1.15

Unassisted with severe problems 5,809 1,749 1,717 563 1,780

Unassisted with nonsevere problems only 903 274 389 56 184

Unassisted with no problems 1,021 244 249 81 447

Assisted 4,283 2,029 995 232 1,027

Any with severe problems 8,001 2,683 2,326 708 2,284

Rent burden > 50% of income 7,781 2,603 2,275 684 2,219

Severely inadequate housing 467 138 146 65 118

[Rent burden only] 6,981 2,357 2,009 598 2,017

Any with nonsevere problems only 1,937 824 595 103 415

Rent burden > 30–50% of income 1,682 751 476 96 359

Moderately inadequate housing 292 107 92 10 83

Crowded housing 229 9 222 0 0

[Rent burden only] 1,441 710 306 93 332

Any with no problems 2,079 790 429 121 739

Other characteristics 12,018 4,297 3,351 932 3,438

One person in household 6,489 3,463 NA NA 3,026

Two-spouse household 1,854 459 1,094 301 NA

Female householder 7,836 2,886 2,426 632 1,892

Non-White Householder 7,027 2,107 2,397 607 1,916

Welfare/SSI income 3,022 1,172 799 244 807

Social Security income 3,746 3,092 265 71 318

Income below 50% poverty 4,423 1,311 1,300 316 1,496

Income below poverty 9,560 3,046 2,963 730 2,821

Income below 150% of poverty 11,607 4,062 3,335 896 3,314

High school graduate 8,745 3,073 2,261 655 2,756

2+ years post-high school 2,500 964 498 220 818

Earnings at minimum wage: At least half time 3,476 249 1,820 477 930

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 67

Earnings at minimum wage: At least full time 2,483 132 1,491 328 532

Earnings main source of income 4,297 289 2,045 567 1,396

Housing rated poor 786 182 247 100 257

Housing rated good+ 8,844 3,400 2,385 658 2,401

Neighborhood rated poor 839 189 294 84 272

Neighborhood rated good+ 8,780 3,358 2,347 674 2,401

In central cities 5,644 2,058 1,440 423 1,723

Suburbs, urban 3,713 1,385 1,058 325 945

Suburbs, rural 1,047 311 395 50 291

Nonmetropolitan 1,613 543 458 134 478

Northeast 2,645 1,131 710 181 623

Midwest 2,546 877 580 165 924

South 4,201 1,299 1,303 311 1,288

West 2,625 989 758 275 603 NA = not applicable. SSI = Supplemental Security Income.

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

68 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-7. Housing Problems and Characteristics of Very Low-Income Worst Case Renters by

Household Type, 2023

Older Families Other

Characteristics Adults, No With Other Nonfamily

Total Children Children Families Households

Renter households (thousands) 8,464 2,462 2,333 874 2,795

Number of children 4,443 NA 4,443 NA NA

Number of persons 17,844 3,193 9,003 2,217 3,431

Children/household 1.90 NA 1.90 NA NA

Persons/household 2.11 1.30 3.86 2.54 1.23

Unassisted with severe problems 8,464 2,462 2,333 874 2,795

Unassisted with nonsevere problems only — — — — —

Unassisted with no problems — — — — —

Assisted — — — — —

Any with severe problems 8,464 2,462 2,333 874 2,795

Rent burden > 50% of income 8,293 2,433 2,300 855 2,705

Severely inadequate housing 395 66 114 60 155

[Rent burden only] 7,492 2,233 2,032 756 2,471

Any with nonsevere problems only — — — — —

Rent burden > 30–50% of income — — — — —

Moderately inadequate housing — — — — —

Crowded housing — — — — —

[Rent burden only] — — — — —

Any with no problems — — — — —

Other characteristics 8,464 2,462 2,333 874 2,795

One person in household 4,181 1,867 NA NA 2,314

Two-spouse household 1,584 329 928 327 NA

Female householder 5,225 1,663 1,600 513 1,449

Non-White Householder 4,785 981 1,709 615 1,480

Welfare/SSI income 1,261 345 418 139 359

Social Security income 2,204 1,875 153 65 111

Income below 50% poverty 2,170 635 637 174 724

Income below poverty 4,636 1,268 1,521 448 1,399

Income below 150% of poverty 6,619 1,871 2,120 670 1,958

High school graduate 6,742 1,982 1,676 632 2,452

2+ years post-high school 2,436 720 491 209 1,016

Earnings at minimum wage: At least half time 4,079 337 1,565 618 1,559

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 69

Earnings at minimum wage: At least full time 3,335 230 1,369 491 1,245

Earnings main source of income 4,634 341 1,680 678 1,935

Housing rated poor 500 109 147 72 172

Housing rated good+ 6,307 1,966 1,727 634 1,980

Neighborhood rated poor 480 99 157 56 168

Neighborhood rated good+ 6,409 1,963 1,752 656 2,038

In central cities 3,826 1,070 934 372 1,450

Suburbs, urban 3,165 966 951 367 881

Suburbs, rural 640 164 217 57 202

Nonmetropolitan 833 262 231 78 262

Northeast 1,477 452 453 140 432

Midwest 1,532 512 313 114 593

South 3,166 849 920 351 1,046

West 2,288 649 646 269 724 NA = not applicable. SSI = Supplemental Security Income.

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

70 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-8. Housing Problems and Characteristics of Extremely Low-Income Worst Case Renters by Household Type, 2023

Older Families Other

Characteristics Adults, No With Other Nonfamily

Total Children Children Families Households

Renter households (thousands) 5,809 1,749 1,717 563 1,780

Number of children 3,339 NA 3,339 NA NA

Number of persons 12,522 2,254 6,682 1,481 2,105

Children/household 1.94 NA 1.94 NA NA

Persons/household 2.16 1.29 3.89 2.63 1.18

Unassisted with severe problems 5,809 1,749 1,717 563 1,780

Unassisted with nonsevere problems only — — — — —

Unassisted with no problems — — — — —

Assisted — — — — —

Any with severe problems 5,809 1,749 1,717 563 1,780

Rent burden > 50% of income 5,701 1,731 1,686 548 1,736

Severely inadequate housing 280 50 102 40 88

[Rent burden only] 5,128 1,577 1,493 483 1,575

Any with nonsevere problems only — — — — —

Rent burden > 30–50% of income — — — — —

Moderately inadequate housing — — — — —

Crowded housing — — — — —

[Rent burden only] — — — — —

Any with no problems — — — — —

Other characteristics 5,809 1,749 1,717 563 1,780

One person in household 2,845 1,332 NA NA 1,513

Two-spouse household 1,014 232 625 157 NA

Female householder 3,682 1,161 1,192 385 944

Non-White Householder 3,330 758 1,252 395 925

Welfare/SSI income 1,106 296 376 114 320

Social Security income 1,581 1,343 115 32 91

Income below 50% poverty 2,170 635 637 174 724

Income below poverty 4,626 1,268 1,512 448 1,398

Income below 150% of poverty 5,617 1,666 1,709 541 1,701

High school graduate 4,435 1,335 1,169 406 1,525

2+ years post-high school 1,439 465 313 144 517

Earnings at minimum wage: At least half time 2,159 140 1,012 338 669

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 71

Earnings at minimum wage: At least full time 1,494 68 836 222 368

Earnings main source of income 2,805 177 1,159 408 1,061

Housing rated poor 358 78 103 46 131

Housing rated good+ 4,263 1,351 1,283 416 1,213

Neighborhood rated poor 335 73 117 34 111

Neighborhood rated good+ 4,343 1,344 1,281 432 1,286

In central cities 2,589 794 666 247 882

Suburbs, urban 2,028 630 660 207 531

Suburbs, rural 487 130 185 31 141

Nonmetropolitan 704 193 206 78 227

Northeast 1,084 344 355 101 284

Midwest 1,211 340 283 96 492

South 2,131 624 643 215 649

West 1,382 440 436 151 355 NA = not applicable. SSI = Supplemental Security Income.

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

72 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-9. Prevalence of Housing Problems Among Very Low-Income Renters by Race and Ethnicity, 2021 and 2023—Number and Percentage

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Non-Hispanic White (thousands) 8,273 8,168 100.0 100.0

Unassisted with severe problems 3,646 3,679 44.1 45.0

Unassisted with nonsevere problems only 1,672 1,556 20.2 19.0

Unassisted with no problems 982 905 11.9 11.1

Assisted 1,974 2,028 23.9 24.8

Any with severe problems 4,386 4,451 53.0 54.5

Rent burden > 50% of income 4,284 4,339 51.8 53.1

Severely inadequate housing 206 182 2.5 2.2

[Rent burden only] 3,876 3,951 46.9 48.4

Any with nonsevere problems only 2,304 2,161 27.8 26.5

Rent burden > 30–50% of income 2,140 2,016 25.9 24.7

Moderately inadequate housing 277 187 3.3 2.3

Crowded housing 102 86 1.2 1.1

[Rent burden only] 1,931 1,899 23.3 23.2

Any with no problems 1,583 1,557 19.1 19.1

Non-Hispanic Black (thousands) 4,887 4,729 100.0 100.0

Unassisted with severe problems 1,922 1,801 39.3 38.1

Unassisted with nonsevere problems only 846 704 17.3 14.9

Unassisted with no problems 356 360 7.3 7.6

Assisted 1,762 1,864 36.1 39.4

Any with severe problems 2,669 2,680 54.6 56.7

Rent burden > 50% of income 2,592 2,589 53.0 54.7

Severely inadequate housing 185 207 3.8 4.4

[Rent burden only] 2,309 2,270 47.2 48.0

Any with nonsevere problems only 1,362 1,253 27.9 26.5

Rent burden > 30–50% of income 1,245 1,158 25.5 24.5

Moderately inadequate housing 195 159 4.0 3.4

Crowded housing 98 30 2.0 0.6

[Rent burden only] 1,075 1,066 22.0 22.5

Any with no problems 856 796 17.5 16.8

Hispanic (thousands) 4,573 4,722 100.0 100.0

Unassisted with severe problems 2,168 2,268 47.4 48.0

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 73

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Unassisted with nonsevere problems only 984 1,022 21.5 21.6

Unassisted with no problems 427 390 9.3 8.3

Assisted 994 1,042 21.7 22.1

Any with severe problems 2,578 2,788 56.4 59.0

Rent burden > 50% of income 2,477 2,710 54.2 57.4

Severely inadequate housing 192 179 4.2 3.8

[Rent burden only] 2,228 2,431 48.7 51.5

Any with nonsevere problems only 1,300 1,308 28.4 27.7

Rent burden > 30–50% of income 1,128 1,178 24.7 24.9

Moderately inadequate housing 180 164 3.9 3.5

Crowded housing 253 228 5.5 4.8

[Rent burden only] 902 942 19.7 19.9

Any with no problems 695 626 15.2 13.3

Asian (thousands) 888 965 100.0 100.0

Unassisted with severe problems 467 532 52.6 55.1

Unassisted with nonsevere problems only 133 134 15.0 13.9

Unassisted with no problems 102 101 11.5 10.5

Assisted 186 199 20.9 20.6

Any with severe problems 547 648 61.6 67.2

Rent burden > 50% of income 538 625 60.6 64.8

Severely inadequate housing 19 29 2.1 3.0

[Rent burden only] 511 597 57.5 61.9

Any with nonsevere problems only 191 183 21.5 19.0

Rent burden > 30–50% of income 167 161 18.8 16.7

Moderately inadequate housing 14 17 1.6 1.8

Crowded housing 32 34 3.6 3.5

[Rent burden only] 145 134 16.3 13.9

Any with no problems 150 134 16.9 13.9 Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

74 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-10. Prevalence of Housing Problems Among Very Low-Income Renters by Region, 2021 and 2023—Number and Percentage

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Northeast (thousands) 3,994 3,978 100.0 100.0

Unassisted with severe problems 1,620 1,478 40.6 37.2

Unassisted with nonsevere problems only 667 661 16.7 16.6

Unassisted with no problems 335 328 8.4 8.2

Assisted 1,373 1,511 34.4 38.0

Any with severe problems 2,172 2,155 54.4 54.2

Rent burden > 50% of income 2,082 2,030 52.1 51.0

Severely inadequate housing 189 197 4.7 5.0

[Rent burden only] 1,828 1,777 45.8 44.7

Any with nonsevere problems only 1,067 1,080 26.7 27.1

Rent burden > 30–50% of income 975 970 24.4 24.4

Moderately inadequate housing 165 137 4.1 3.4

Crowded housing 81 81 2.0 2.0

[Rent burden only] 831 873 20.8 21.9

Any with no problems 755 744 18.9 18.7

Midwest (thousands) 3,947 3,947 100.0 100.0

Unassisted with severe problems 1,484 1,533 37.6 38.8

Unassisted with nonsevere problems only 954 919 24.2 23.3

Unassisted with no problems 450 394 11.4 10.0

Assisted 1,059 1,101 26.8 27.9

Any with severe problems 1,860 2,003 47.1 50.7

Rent burden > 50% of income 1,804 1,949 45.7 49.4

Severely inadequate housing 94 75 2.4 1.9

[Rent burden only] 1,656 1,820 42.0 46.1

Any with nonsevere problems only 1,306 1,226 33.1 31.1

Rent burden > 30–50% of income 1,187 1,131 30.1 28.7

Moderately inadequate housing 168 136 4.3 3.4

Crowded housing 97 38 2.5 1.0

[Rent burden only] 1,048 1,055 26.6 26.7

Any with no problems 781 718 19.8 18.2

South (thousands) 6,727 6,775 100.0 100.0

Unassisted with severe problems 3,168 3,165 47.1 46.7

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 75

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Unassisted with nonsevere problems only 1,312 1,217 19.5 18.0

Unassisted with no problems 664 720 9.9 10.6

Assisted 1,582 1,672 23.5 24.7

Any with severe problems 3,811 3,881 56.7 57.3

Rent burden > 50% of income 3,703 3,794 55.0 56.0

Severely inadequate housing 244 214 3.6 3.2

[Rent burden only] 3,274 3,371 48.7 49.8

Any with nonsevere problems only 1,803 1,728 26.8 25.5

Rent burden > 30–50% of income 1,652 1,603 24.6 23.7

Moderately inadequate housing 224 212 3.3 3.1

Crowded housing 121 116 1.8 1.7

[Rent burden only] 1,471 1,413 21.9 20.9

Any with no problems 1,112 1,166 16.5 17.2

West (thousands) 4,670 4,440 100.0 100.0

Unassisted with severe problems 2,254 2,288 48.3 51.5

Unassisted with nonsevere problems only 808 722 17.3 16.3

Unassisted with no problems 477 348 10.2 7.8

Assisted 1,130 1,082 24.2 24.4

Any with severe problems 2,745 2,808 58.8 63.2

Rent burden > 50% of income 2,666 2,761 57.1 62.2

Severely inadequate housing 140 126 3.0 2.8

[Rent burden only] 2,445 2,531 52.4 57.0

Any with nonsevere problems only 1,163 1,041 24.9 23.4

Rent burden > 30–50% of income 1,022 931 21.9 21.0

Moderately inadequate housing 146 89 3.1 2.0

Crowded housing 195 152 4.2 3.4

[Rent burden only] 839 818 18.0 18.4

Any with no problems 761 590 16.3 13.3 Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

76 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-11A. Prevalence of Housing Problems Among Very Low-Income Renters by Metropolitan Location, 2021 and 2023—Number and Percentage

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Central cities (thousands) 9,375 8,904 100.0 100.0

Unassisted with severe problems 4,073 3,827 43.4 43.0

Unassisted with nonsevere problems only 1,767 1,525 18.8 17.1

Unassisted with no problems 806 710 8.6 8.0

Assisted 2,729 2,843 29.1 31.9

Any with severe problems 5,209 5,161 55.6 58.0

Rent burden > 50% of income 5,037 4,958 53.7 55.7

Severely inadequate housing 376 376 4.0 4.2

[Rent burden only] 4,491 4,407 47.9 49.5

Any with nonsevere problems only 2,609 2,330 27.8 26.2

Rent burden > 30–50% of income 2,329 2,098 24.8 23.6

Moderately inadequate housing 370 301 3.9 3.4

Crowded housing 249 181 2.7 2.0

[Rent burden only] 2,014 1,866 21.5 21.0

Any with no problems 1,557 1,413 16.6 15.9

Suburbs, urban (thousands) 6,187 6,366 100.0 100.0

Unassisted with severe problems 3,062 3,165 49.5 49.7

Unassisted with nonsevere problems only 1,195 1,215 19.3 19.1

Unassisted with no problems 564 507 9.1 8.0

Assisted 1,366 1,478 22.1 23.2

Any with severe problems 3,603 3,851 58.2 60.5

Rent burden > 50% of income 3,536 3,800 57.2 59.7

Severely inadequate housing 116 128 1.9 2.0

[Rent burden only] 3,251 3,501 52.5 55.0

Any with nonsevere problems only 1,616 1,643 26.1 25.8

Rent burden > 30–50% of income 1,509 1,551 24.4 24.4

Moderately inadequate housing 162 150 2.6 2.4

Crowded housing 169 127 2.7 2.0

[Rent burden only] 1,306 1,386 21.1 21.8

Any with no problems 967 873 15.6 13.7

Suburbs, rural (thousands) 1,504 1,653 100.0 100.0

Unassisted with severe problems 587 641 39.0 38.8

Unassisted with nonsevere problems only 346 387 23.0 23.4

Unassisted with no problems 239 257 15.9 15.5

Assisted 331 369 22.0 22.3

Any with severe problems 701 772 46.6 46.7

Rent burden > 50% of income 663 752 44.1 45.5

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 77

Prevalence Number Number Percentage Percentage

2021 2023 2021 2023

Severely inadequate housing 68 44 4.5 2.7

[Rent burden only] 583 679 38.8 41.1

Any with nonsevere problems only 461 492 30.7 29.8

Rent burden > 30–50% of income 430 449 28.6 27.2

Moderately inadequate housing 49 38 3.3 2.3

Crowded housing 53 60 3.5 3.6

[Rent burden only] 360 398 23.9 24.1

Any with no problems 342 389 22.7 23.5

Nonmetropolitan (thousands) 2,273 2,217 100.0 100.0

Unassisted with severe problems 805 832 35.4 37.5

Unassisted with nonsevere problems only 433 394 19.0 17.8

Unassisted with no problems 317 316 13.9 14.3

Assisted 718 676 31.6 30.5

Any with severe problems 1,076 1,063 47.3 47.9

Rent burden > 50% of income 1,019 1,024 44.8 46.2

Severely inadequate housing 105 65 4.6 2.9

[Rent burden only] 879 912 38.7 41.1

Any with nonsevere problems only 653 610 28.7 27.5

Rent burden > 30–50% of income 569 537 25.0 24.2

Moderately inadequate housing 122 84 5.4 3.8

Crowded housing 23 19 1.0 0.9

[Rent burden only] 508 507 22.3 22.9

Any with no problems 544 544 23.9 24.5

U.S. Total (thousands) 19,338 19,141 100.0 100.0

Unassisted with severe problems 8,526 8,464 44.1 44.2

Unassisted with nonsevere problems only 3,742 3,520 19.4 18.4

Unassisted with no problems 1,926 1,789 10.0 9.3

Assisted 5,144 5,366 26.6 28.0

Any with severe problems 10,589 10,846 54.8 56.7

Rent burden > 50% of income 10,255 10,533 53.0 55.0

Severely inadequate housing 666 612 3.4 3.2

[Rent burden only] 9,204 9,498 47.6 49.6

Any with nonsevere problems only 5,340 5,074 27.6 26.5

Rent burden > 30–50% of income 4,836 4,636 25.0 24.2

Moderately inadequate housing 703 573 3.6 3.0

Crowded housing 494 386 2.6 2.0

[Rent burden only] 4,189 4,157 21.7 21.7

Any with no problems 3,410 3,218 17.6 16.8

78 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 79 Exhibit A-11B. Housing Conditions of Renter Households by Relative Income, Sampled Metropolitan Areas, 2021 and 2023

Households Household Income as Percentage of HUD

Area Median Family Income

2021 2023

All All

0–50% Incomes 0–50% Incomes

Atlanta-Sandy Springs-Roswell, GA

Total households (thousands) 304 822 272 787

Unassisted with severe problems 159 147

Unassisted with nonsevere problems only 51 39

Unassisted with no problems 32 24

Assisted 61 61 Boston-Cambridge-Newton, MA-NH

Total households (thousands) 373 791 347 754

Unassisted with severe problems 139 124

Unassisted with nonsevere problems only 52 49

Unassisted with no problems 26 18

Assisted 156 157

Chicago-Naperville-Elgin, IL-IN-WI

Total households (thousands) 523 1,262 589 1,377

Unassisted with severe problems 219 236

Unassisted with nonsevere problems only 119 125

Unassisted with no problems 65 64

Assisted 119 163

Dallas-Fort Worth-Arlington, TX

Total households (thousands) 345 1,158 370 1,224

Unassisted with severe problems 171 197

Unassisted with nonsevere problems only 88 73

Unassisted with no problems 33 39

Assisted 53 62

Detroit-Warren-Dearborn, MI

Total households (thousands) 221 514 221 493

Unassisted with severe problems 91 92

Unassisted with nonsevere problems only 47 48

Unassisted with no problems 18 20

Assisted 66 62 Houston-The Woodlands-Sugar Land, TX

Total households (thousands) 410 1,046 399 1,081

Unassisted with severe problems 227 244

Unassisted with nonsevere problems only 86 81

80 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Households Household Income as Percentage of HUD

Area Median Family Income

2021 2023

All All

0–50% Incomes 0–50% Incomes

Unassisted with no problems 29 23

Assisted 68 51 Los Angeles-Long Beach-Anaheim, CA

Total households (thousands) 1,167 2,474 1,047 2,480

Unassisted with severe problems 599 614

Unassisted with nonsevere problems only 232 161

Unassisted with no problems 125 85

Assisted 211 187

Miami-Fort Lauderdale-West Palm Beach, FL

Total households (thousands) 381 856 415 930

Unassisted with severe problems 217 245

Unassisted with nonsevere problems only 41 45

Unassisted with no problems 40 34

Assisted 83 91

New York-Newark-Jersey City, NY-NJ-PA

Total households (thousands) 1,825 3,745 1,858 3,841

Unassisted with severe problems 799 711

Unassisted with nonsevere problems only 264 249

Unassisted with no problems 145 162

Assisted 618 736

Philadelphia-Camden-Wilmington, PA-NJ-DE-MD

Total households (thousands) 345 805 300 780

Unassisted with severe problems 157 136

Unassisted with nonsevere problems only 71 48

Unassisted with no problems 28 24

Assisted 89 92

Phoenix-Mesa-Scottsdale, AZ

Total households (thousands) 190 631 182 645

Unassisted with severe problems 107 104

Unassisted with nonsevere problems only 29 26

Unassisted with no problems 20 14

Assisted 33 38

Riverside-San Bernardino-Ontario, CA

Total households (thousands) 167 488 178 470

Unassisted with severe problems 103 97

Unassisted with nonsevere problems only 15 33

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 81

Households Household Income as Percentage of HUD

Area Median Family Income

2021 2023

All All

0–50% Incomes 0–50% Incomes

Unassisted with no problems 15 12

Assisted 34 36

San Francisco-Oakland-Hayward, CA

Total households (thousands) 311 793 340 799

Unassisted with severe problems 129 152

Unassisted with nonsevere problems only 53 52

Unassisted with no problems 34 30

Assisted 96 106

Seattle-Tacoma-Bellevue, WA

Total households (thousands) 239 658 234 665

Unassisted with severe problems 97 119

Unassisted with nonsevere problems only 41 38

Unassisted with no problems 30 14

Assisted 71 63

Washington-Arlington-Alexandria, DC-VA-MD-WV

Total households (thousands) 339 909 353 834

Unassisted with severe problems 154 147

Unassisted with nonsevere problems only 63 63

Unassisted with no problems 35 28

Assisted 87 115

Baltimore-Columbia-Towson, MD

Total households (thousands) 304 674 — —

Unassisted with severe problems 157 —

Unassisted with nonsevere problems only 39 —

Unassisted with no problems 28 —

Assisted 81 — Birmingham-Hoover, AL

Total households (thousands) 145 274 — —

Unassisted with severe problems 58 —

Unassisted with nonsevere problems only 31 —

Unassisted with no problems 10 —

Assisted 47 —

Cincinnati, OH-KY-IN

Total households (thousands) — — 210 548

Unassisted with severe problems — 42

Unassisted with nonsevere problems only — 69

82 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Households Household Income as Percentage of HUD

Area Median Family Income

2021 2023

All All

0–50% Incomes 0–50% Incomes

Unassisted with no problems — 31

Assisted — 69

Cleveland-Elyria, OH

Total households (thousands) — — 299 555

Unassisted with severe problems — 139

Unassisted with nonsevere problems only — 40

Unassisted with no problems — 16

Assisted — 103 Denver-Aurora-Lakewood, CO

Total households (thousands) — — 273 869

Unassisted with severe problems — 122

Unassisted with nonsevere problems only — 68

Unassisted with no problems — 13

Assisted — 69

Kansas City, MO-KS

Total households (thousands) — — 164 322

Unassisted with severe problems — 66

Unassisted with nonsevere problems only — 20

Unassisted with no problems — 28

Assisted — 50

Las Vegas-Henderson-Paradise, NV

Total households (thousands) 286 860 — —

Unassisted with severe problems 182 —

Unassisted with nonsevere problems only 46 —

Unassisted with no problems 27 —

Assisted 30 — Memphis, TN-MS-AR

Total households (thousands) — — 107 284

Unassisted with severe problems — 48

Unassisted with nonsevere problems only — 22

Unassisted with no problems — 13

Assisted — 23

Milwaukee-Waukesha-West Allis, WI

Total households (thousands) — — 277 486

Unassisted with severe problems — 107

Unassisted with nonsevere problems only — 81

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 83

Households Household Income as Percentage of HUD

Area Median Family Income

2021 2023

All All

0–50% Incomes 0–50% Incomes

Unassisted with no problems — 42

Assisted — 47

Minneapolis-St. Paul-Bloomington, MN-WI

Total households (thousands) 413 898 — —

Unassisted with severe problems 133 —

Unassisted with nonsevere problems only 108 —

Unassisted with no problems 33 —

Assisted 139 —

New Orleans-Metairie, LA

Total households (thousands) — — 134 317

Unassisted with severe problems — 51

Unassisted with nonsevere problems only — 24

Unassisted with no problems — 11

Assisted — 47

Oklahoma City, OK

Total households (thousands) 190 406 — —

Unassisted with severe problems 119 —

Unassisted with nonsevere problems only 35 —

Unassisted with no problems 6 —

Assisted 29 —

Pittsburgh, PA

Total households (thousands) — — 169 342

Unassisted with severe problems — 57

Unassisted with nonsevere problems only — 49

Unassisted with no problems — 20

Assisted — 45

Portland-Vancouver-Hillsboro, OR-WA

Total households (thousands) — — 96 277

Unassisted with severe problems — 40

Unassisted with nonsevere problems only — 23

Unassisted with no problems — (D)

Assisted — 28

Raleigh, NC

Total households (thousands) — — 83 272

Unassisted with severe problems — 27

Unassisted with nonsevere problems only — 16

84 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Households Household Income as Percentage of HUD

Area Median Family Income

2021 2023

All All

0–50% Incomes 0–50% Incomes

Unassisted with no problems — 22

Assisted — 18 Richmond, VA

Total households (thousands) 127 330 — —

Unassisted with severe problems 57 —

Unassisted with nonsevere problems only 30 —

Unassisted with no problems 15 —

Assisted 25 —

Rochester, NY

Total households (thousands) 177 344 — —

Unassisted with severe problems 65 —

Unassisted with nonsevere problems only 27 —

Unassisted with no problems 32 —

Assisted 53 —

San Antonio-New Braunfels, TX

Total households (thousands) 259 723 — —

Unassisted with severe problems 116 —

Unassisted with nonsevere problems only 69 —

Unassisted with no problems 26 —

Assisted 47 —

San Jose-Sunnyvale-Santa Clara, CA

Total households (thousands) 217 686 — —

Unassisted with severe problems 99 —

Unassisted with nonsevere problems only 37 —

Unassisted with no problems 16 —

Assisted 65 —

Tampa-St. Petersburg-Clearwater, FL

Total households (thousands) 261 876 — —

Unassisted with severe problems 137 —

Unassisted with nonsevere problems only 49 —

Unassisted with no problems 23 —

Assisted 51 — Note: Each of the 15 largest metropolitan areas, listed first, are part of the American Housing Survey longitudinal panel surveyed every 2 years. The remaining 10 metropolitan areas represent a subset of the 16th to 50th largest metropolitan areas surveyed on a rotating basis every 4 years. Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 85 Exhibit A-12. Households Occupying Rental Units by Affordability of Rent and Income of Occupants, 2021 and 2023

Relative Income of Occupied and Vacant Rental Units (thousands) by Unit Affordability Category (percent of HAMFI needed

Households to afford the highest rent in the category)

2023 10* 20 30 40 50 60 70 80 90 100 110 >110 Total

Extremely low income 792 1,850 1,681 1,130 1,845 1,428 907 787 470 192 337 599 12,018 (< 30% HAMFI)

Very low income (30–50%) 220 269 424 813 1,348 1,112 939 736 424 214 267 357 7,123

Low income (50–80%) 231 380 498 730 1,427 1,748 1,436 1,273 788 389 474 538 9,912

Middle income or higher 363 391 510 635 1,440 1,974 2,436 2,078 2,394 1,588 1,617 1,898 17,324 (> 80%)

Vacant units for rent 122 91 83 225 355 532 530 333 376 261 331 649 3,888

Total units vacant and 1,728 2,981 3,196 3,533 6,415 6,794 6,248 5,207 4,452 2,644 3,026 4,041 50,265 occupied

2021 10* 20 30 40 50 60 70 80 90 100 110 120+ Total

Extremely low income 797 1,664 1,744 834 2,096 1,847 853 1,127 326 232 247 554 12,321 (< 30% HAMFI)

Very low income (30–50%) 193 235 488 598 1,338 1,456 768 829 269 221 216 407 7,018

Low income (50–80%) 200 287 433 538 1,516 1,712 1,259 1,684 642 363 345 652 9,631

Middle income or higher 257 425 501 376 1,355 2,200 2,072 2,835 2,025 1,177 1,548 2,253 17,024 (> 80%)

Vacant units for rent 102 75 98 254 453 552 441 518 304 260 332 695 4,084

Total units vacant and 1,549 2,686 3,264 2,600 6,758 7,767 5,393 6,993 3,566 2,253 2,688 4,561 50,078 occupied

HAMFI = HUD Area Median Family Income.

* The 10-percent-of-HAMFI category includes units occupied with no cash rent. Notes: The method of assigning units to cost categories was modified in 2017 to account for limited HUD administrative exceptions to program income limits. Slight unit affordability adjustments were applied to outlier cases for which Area Median Income-determined affordability differed from administratively determined affordability categories.

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

86 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit A-13. Renters and Rental Units Affordable and Available to Them by Relative Income, 2001–23

Income 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023

Renter households 34,042 33,614 33,951 35,054 35,396 38,867 40,294 43,930 43,993 44,660 45,991 46,378 (thousands)

Extremely low-income 8,739 9,077 9,729 9,243 9,961 11,774 11,163 11,290 11,548 11,748 12,319 12,017 (< 30% HAMFI)

Very low-income (30–50%) 6,315 6,581 6,342 6,697 7,157 7,492 7,375 7,945 6,519 6,640 7,019 7,123

Low-income (50–80%) 7,251 7,460 7,488 7,650 7,168 7,750 7,795 8,696 8,637 8,786 9,631 9,912

Middle-income or higher 11,737 10,496 10,392 11,464 11,110 11,850 13,961 15,999 17,289 17,486 17,022 17,326 (> 80%)

Affordable units 37,197 37,577 37,924 39,330 39,744 43,075 43,992 48,670 48,820 49,335 50,075 50,266

Extremely low-income 6,870 7,098 6,747 7,280 6,265 6,854 7,294 7,117 7,982 8,256 7,498 7,904 (< 30% HAMFI)

Very low-income (30–50%) 12,366 12,863 12,368 11,071 10,938 10,947 10,727 9,643 8,404 9,393 9,358 9,947

Low-income (50–80%) 13,634 13,518 14,044 15,063 16,228 17,995 17,904 19,326 19,674 19,112 20,153 18,251

Middle-income or higher 4,328 4,099 4,765 5,916 6,313 7,279 8,067 12,584 12,760 12,574 13,066 14,164 (> 80%)

Affordable and available 37,197 37,577 37,924 39,330 39,744 43,075 43,992 48,670 48,820 49,335 50,074 50,266 units

Extremely low-income 3,803 3,996 3,982 4,224 3,665 4,220 4,354 4,278 4,595 4,732 4,480 4,618 (< 30% HAMFI)

Very low-income (30–50%) 8,132 8,744 8,549 7,786 8,045 8,225 7,734 7,576 6,066 6,700 6,489 6,629

Low-income (50–80%) 11,665 12,396 12,865 13,196 14,004 15,361 14,529 15,862 15,353 15,009 16,020 15,027

Middle-income or higher 13,597 12,441 12,528 14,123 14,029 15,270 17,375 20,955 22,806 22,894 23,085 23,992 (> 80%)

HAMFI = HUD Area Median Family Income.

Notes: Income categories in this exhibit do not overlap and, therefore, differ from the standard definitions. The method of assigning units to cost categories was modified in 2017 to account for limited HUD administrative exceptions to program income limits. Slight unit affordability adjustments were applied to outlier cases for which Area Median Income-determined affordability differed from administratively determined affordability categories.

Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 87

Exhibit A-14. Average Income and Average Gross Rent of Renter Households by Relative Income, 2021 and 2023

Household Income as Percentage of HUD-Adjusted Area Median Family

Households Income

2023 0–30% > 30–50% > 50–80% > 80–120% > 120% All Incomes

Total households

(thousands) 12,017 7,123 9,912 8,429 8,897 46,378

Unassisted with severe

problems 5,808 2,656 1,202 394 207 10,268

Unassisted with nonsevere

problems only 903 2,617 4,305 2,209 942 10,975

Unassisted with no problems 1,022 768 3,627 5,455 7,453 18,325

Assisted 4,284 1,082 779 371 294 6,811

Average monthly income $1,065 $2,881 $4,513 $6,473 $15,300 $5,795

Unassisted with severe

problems $1,108 $2,768 $4,285 $5,662 $12,170 $2,308

Unassisted with nonsevere

problems only $1,723 $3,056 $4,569 $6,312 $14,930 $5,214

Unassisted with no problems $690 $2,974 $4,526 $6,635 $15,460 $9,321

Assisted $959 $2,671 $4,492 $5,915 $14,830 $2,505

Average gross rent $1,187 $1,425 $1,523 $1,751 $2,165 $1,586

Unassisted with severe

problems $1,638 $2,087 $3,056 $4,711 $6,892 $2,144

Unassisted with nonsevere

problems only $797 $1,168 $1,626 $2,131 $2,591 $1,633

Unassisted with no problems $667 $537 $946 $1,391 $1,995 $1,472

Assisted $782 $1,052 $1,276 $1,650 $1,795 $972

2021 0–30% > 30–50% > 50–80% > 80–120% > 120% All Incomes

Total households

(thousands) 12,319 7,019 9,631 7,775 9,247 45,991

Unassisted with severe

problems 6,051 2,475 1,105 324 266 10,222

Unassisted with nonsevere

problems only 1,031 2,711 4,386 1,890 931 10,949

Unassisted with no problems 1,148 778 3,534 5,173 7,813 18,445

Assisted 4,089 1,055 606 388 236 6,374

Average monthly income $972 $2,490 $3,949 $5,519 $12,130 $4,839

Unassisted with severe

problems $1,022 $2,378 $3,780 $4,395 $9,478 $1,976

Unassisted with nonsevere

problems only $1,513 $2,656 $3,984 $5,528 $9,885 $4,191

Unassisted with no problems $521 $2,494 $3,970 $5,611 $12,530 $7,780

Assisted $888 $2,323 $3,880 $5,197 $10,500 $2,028

Average gross rent $992 $1,248 $1,330 $1,479 $1,897 $1,366

Unassisted with severe

problems $1,342 $1,881 $2,691 $4,399 $5,643 $1,827

Unassisted with nonsevere

problems only $728 $1,034 $1,406 $1,808 $2,338 $1,399

Unassisted with no problems $631 $487 $854 $1,172 $1,730 $1,285

88 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Assisted $641 $876 $1,068 $1,537 $1,474 $806 Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 89 Exhibit A-15. Housing Conditions of Households With People Younger Than 62 Who Have Disabilities by Disability Type, 2021 and 2023

Conditions Functional Limitations ADL/IADL Limitations

Any Independent

2023 Limitation Hearing Visual Cognitive Ambulatory Self-Care Living

Households (thousands) 13,602 3,425 2,741 6,379 5,166 1,888 3,941

Renter households 7,580 2,064 1,313 3,347 2,709 1,023 2,131

Owner households 6,022 1,360 1,428 3,032 2,457 866 1,810

Renters (thousands) 6,022 1,360 1,428 3,032 2,457 866 1,810

Unassisted with severe problems 1,376 330 342 717 618 278 504

Unassisted with nonsevere problems only 1,403 315 341 676 441 131 379

Unassisted with no problems 1,741 431 385 838 627 188 386

Assisted 1,502 285 360 800 771 269 541

Very low-income renters (thousands) 1,465 348 358 681 576 170 412

Unassisted with severe problems 360 82 78 169 152 46 111

Unassisted with nonsevere problems only 618 158 165 285 239 59 186

Unassisted with no problems 196 36 49 68 64 26 41

Assisted 291 72 65 159 121 39 73

Any with severe problems 409 89 94 198 172 61 124

Rent burden > 50% of income 353 70 89 166 150 47 107

Severely inadequate housing 69 28 7 43 32 17 20

[Rent burden only] 298 52 77 138 125 41 83

Any with nonsevere problems only 748 201 180 355 280 67 212

Rent burden > 30–50% of income 653 156 136 307 249 59 166

Moderately inadequate housing 139 61 45 79 40 15 62

Crowded housing 32 D 18 10 4 (D) 3

[Rent burden only] 578 132 118 267 237 51 148

90 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Any with no problems 307 58 84 128 124 41 76

Any Independent

2021 Limitation Hearing Visual Cognitive Ambulatory Self-Care Living

Households (thousands) 13,135 3,410 2,927 5,593 4,970 1,667 3,519

Renter households 7,051 2,068 1,501 2,743 2,481 864 1,801

Owner households 6,084 1,342 1,426 2,849 2,489 802 1,718

Renters (thousands) 6,084 1,342 1,426 2,849 2,489 802 1,718

Unassisted with severe problems 1,420 276 377 690 631 260 455

Unassisted with nonsevere problems only 1,406 339 329 605 538 136 331

Unassisted with no problems 1,741 446 427 694 545 125 365

Assisted 1,517 281 293 860 775 282 567

Very low-income renters (thousands) 1,382 273 291 670 601 173 403

Unassisted with severe problems 291 57 60 147 124 52 114

Unassisted with nonsevere problems only 632 120 130 310 289 69 163

Unassisted with no problems 175 35 54 66 69 17 39

Assisted 284 61 48 146 120 34 88

Any with severe problems 339 66 71 172 146 59 127

Rent burden > 50% of income 287 57 45 140 120 41 109

Severely inadequate housing 57 11 29 34 30 21 21

[Rent burden only, adequate housing] 268 47 37 129 114 38 101

Any with nonsevere problems only 745 150 154 380 327 82 193

Rent burden > 30–50% of income 675 126 132 339 288 74 170

Moderately inadequate housing 113 29 16 75 50 11 50

Crowded housing 51 19 29 22 12 5 6

[Rent burden only] 586 102 109 287 265 65 137

Any with no problems 298 57 67 118 128 32 84

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 91

ADL = Activities of Daily Living. IADL = Instrumental Activities of Daily Living.

(D) = value suppressed in accordance with U.S. Census Bureau disclosure prevention requirements. Source: HUD Office of Policy Development and Research tabulations of the American Housing Survey data

92 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Appendix B. Supplemental Exhibits

Exhibit B-1. Bird’s-Eye View of Worst Case Housing Needs in 2023

Note: Not to scale.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 93

Exhibit B-2. Affordable Rental Units Occupied by Higher-Income Renters, 2023

AMI = Area Median Income.

Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

94 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Exhibit B-3. Rental Stock of Below-Fair Market Rent Units by Region and Metropolitan Location, 2023

Affordable,

Affordable, Affordable Available,

Affordable Available, and and

and and Affordable Available Adequate

Affordable Available Adequate Housing Housing Housing

Housing Housing Housing Units Units Units

Households Units Units Units per 100 per 100 per 100

Location (thousands) (thousands) (thousands) (thousands) Households Households Households

All 27,999 29,046 21,181 19,371 103.7 75.6 69.2

Northeast 5,508 5,856 4,520 3,955 106.3 82.1 71.8

Midwest 4,711 5,177 3,405 3,190 109.9 72.3 67.7

South 10,235 10,316 7,506 6,870 100.8 73.3 67.1

West 7,545 7,696 5,750 5,356 102.0 76.2 71.0

Central cities 13,175 13,541 10,112 9,074 102.8 76.8 68.9

Suburbs, urban 9,754 9,346 6,872 6,424 95.8 70.5 65.9

Suburbs, rural 2,214 2,613 1,819 1,714 118.0 82.2 77.4

Nonmetropolitan areas 2,855 3,545 2,377 2,159 124.2 83.3 75.6 Source: HUD Office of Policy Development and Research tabulations of American Housing Survey data

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 95

Appendix C. Federal Housing Assistance and Affordable Housing Programs

HUD provides rental housing assistance through three key programs.72

1. Public Housing. This program provides assisted housing to approximately 800,000

households through units owned or managed by local public housing agencies. Families are generally required to pay 30 percent of their income for rent.

2. Project-Based Assisted Housing. Various assisted multifamily housing programs

provide assisted housing to approximately 1.2 million households living in privately owned rental housing. The assistance is attached to the units reserved for low-income families, who are generally required to pay 30 percent of their incomes for rent.

3. Tenant-Based Rental Assistance. The Housing Choice Voucher program supplements

the rent payments of 2.4 million households in the private rental market. The program is administered through public housing agencies. Families are generally required to pay 30 percent of their income for rent. However, they may choose to pay larger percentages to obtain units with higher rents.

Several other federal housing programs produce affordable housing, typically with shallower subsidies. Although these units are often more affordable than market-rate units, without additional rent subsidies (such as vouchers), extremely low-income families would often have to pay much more than 30 percent of their income under these programs.

• Low-Income Housing Tax Credit (LIHTC) Program. Tax credits offered to investors

by the U.S. Department of the Treasury subsidize the capital costs of units to provide sufficient units at rents affordable at 60 percent of Area Median Income (AMI), 50

percent of AMI, or meeting an average income test.73

• HOME Investment Partnerships Program. This program provides annual formula

grants to state and local governments that can be used to assist homeowners, first-time homebuyers, or renters. Qualifying rents must be affordable to households with incomes not exceeding 65 percent of AMI or must be less than the local Fair Market Rent, whichever is less.

• Housing Opportunities for Persons With AIDS (HOPWA). HOPWA provides an

annual formula and competitive grants available to state and local governments and nonprofits for rental assistance targeted to a special-needs population.

• Older Rental Subsidy Programs. Programs named for sections of the National Housing

Act, primarily the Section 221(d)(3) Below Market Interest Rate Program and the Section 236 mortgage assistance program, were active from the early 1960s through the early 1970s. They were designed to produce affordable housing for families with incomes higher than the public housing income limits.

For further details on HUD program requirements, see HUD (2023).

—————————————————————————————————————— 72 The number of households assisted by key programs based on HUD administrative records is available through the

here are from the 2023 Picture tool, “number reported” field, which reflects the number of households assisted. 73 Additional Information about income compliance in LIHTC-supported units is available at Picture of Subsidized Households query tool at https://www.huduser.gov/portal/datasets/assthsg.html. The data presented

https://www.federalregister.gov/documents/2022/10/12/2022-22070/section-42-low-income-housing-credit-average-

income-test-regulations.

96 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Appendix D. Previous Reports to Congress on Worst Case Needs

• Priority Problems and “Worst Case” Needs in 1989 (June 1991, HUD-1314-PDR).

• The Location of Worst Case Needs in the Late 1980s (December 1992, HUD-1387-PDR).

• Worst Case Needs for Housing Assistance in the United States in 1990 and 1991 (June 1994,

HUD-1481-PDR).

• Rental Housing Assistance at a Crossroads: A Report to Congress on Worst Case Housing

Needs (March 1996).

• Rental Housing Assistance—The Crisis Continues (April 1998).

• Rental Housing Assistance—The Worsening Crisis: A Report to Congress on Worst Case

Housing Needs (March 2000).

• A Report on Worst Case Housing Needs in 1999: New Opportunity Amid Continuing

Challenges, Executive Summary (January 2001).

• Trends in Worst Case Needs for Housing, 1978–1999 (December 2003).

• Affordable Housing Needs: A Report to Congress on the Significant Need for Housing

(December 2005).

• Affordable Housing Needs 2005: Report to Congress (May 2007).

• Housing Needs of Persons With Disabilities: Supplemental Findings to the Affordable

Housing Needs 2005 Report (February 2008).

• Worst Case Housing Needs 2007: A Report to Congress (May 2010).

• Worst Case Housing Needs 2009: Report to Congress (February 2011).

• Worst Case Housing Needs 2011: Report to Congress (August 2013).

• Worst Case Housing Needs: 2015 Report to Congress (April 2015).

• Worst Case Housing Needs: 2017 Report to Congress (August 2017).

• Worst Case Housing Needs: 2019 Report to Congress (June 2020).

• Worst Case Housing Needs: 2021 Report to Congress (September 2021).

• Worst Case Housing Needs: 2023 Report to Congress (September 2023).

These publications are available online at https://www.huduser.gov/portal/AFWCN.html.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 97 Appendix E. Data and Methodology

A report such as this one requires researchers to use a number of specialized concepts, definitions, and assumptions when analyzing and presenting the data. This appendix documents such elements for those who wish to understand the results more fully or replicate and extend the results in their research.

Using the American Housing Survey Data

This report uses data from the most recently available American Housing Survey (AHS), conducted in 2023. AHS, which is the only detailed periodic national housing survey in the United States, is sponsored by HUD and conducted by the U.S. Census Bureau. It provides nationally representative data on a wide range of housing subjects, including apartments, single-family homes, mobile homes, vacant homes, family composition, income, housing and neighborhood quality, housing costs, equipment, fuel type, size of housing units, and recent

moves.74

For most of its history, AHS has collected national data every 2 years, originally from a sample of about 84,400 housing units and currently from a new, redesigned sample of about 85,400 housing units begun in 2015 (Census Bureau and HUD, 2013, 2017). The survey, which started in 1973, sampled the same housing units between 1985 and 2013—with occasional adjustments and supplements—plus samples of newly constructed units to ensure the data’s continuity and timeliness. To address the many challenges in maintaining the AHS longitudinal sample for nearly 30 years, including attrition of housing units, response burden, changes in geography, and disclosure avoidance and mitigation, HUD and the Census Bureau undertook a major redesign for the 2015 AHS. The redesign included the selection of a new national and metropolitan area longitudinal sample, changes to weighting methodologies and imputation processes, and a reevaluation of variables. Information from the worst case needs reports has helped inform public policy decisions, including decisions on targeting existing resources, determining the need for additional resources, and choosing the form that housing assistance should take.

Starting in May 2025, HUD and the Census Bureau plan to move AHS from a survey conducted

every 2 years to a continuous operation, with data collected every month throughout each year.75

To accurately estimate worst case needs for federal rental assistance from AHS data, it is essential to determine whether household incomes fall below HUD’s official very low-income (VLI) limits (50 percent of HUD Area Median Family Income [HAMFI], also termed Area Median Income [AMI]), whether a household already receives housing assistance, and whether an unassisted income-eligible household has one or more of the priority problems that formerly conferred preference in tenant selection for assistance (rent burdens exceeding 50 percent of income, substandard housing, or being involuntarily displaced).

HUD and the Census Bureau provide a Table Creator for the 2011 to 2023 AHS surveys. The Table Creator enables users to create customized tabulations of AHS data without the difficulties and special skills needed to analyze microdata Public Use Files. Content includes variables

—————————————————————————————————————— 74 An online codebook that documents all variables available in all AHS years is available at

https://www.census.gov/data-tools/demo/codebook/ahs/ahsdict.html.

75 More information about continuous AHS data collection is available at https://www.census.gov/programs-

surveys/ahs/about/upcoming-releases/2025-release.html.

98 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

similar to those provided in this report.76 A national data source that is a reasonable alternative to AHS for measuring housing needs is the American Community Survey (ACS). ACS has the advantage of a larger sample size that supports estimates for small geographic areas. Disadvantages of ACS include addressing housing assistance status less comprehensively and providing much less information about housing unit characteristics. For example, ACS no longer ascertains whether units contain complete plumbing systems. HUD also sponsors special tabulations of ACS data that have HUD income limits information, which the public can use to

estimate housing needs similar to those in this report for various small geographies.77

Weighting. Because AHS is based on a sample of housing units rather than a census of all housing units, estimates based on the data must be “weighted up” so that totals for each year match independent estimates of the total housing stock and better represent the full housing stock. The Census Bureau weights up responses to account for under coverage of households and household nonresponse (about 15 percent). The weights for 2001-through-2009 AHS data used in this report are based on the 2000 Census of Housing, with adjustments for estimated change since then. Since 2011, AHS data have been weighted to 2010 census benchmarks. AHS datasets for recent years are provided with multiple “replicate” weights for each observation that can be used to estimate standard errors and evaluate statistical significance without knowledge of stratification and cluster sampling parameters of complex sample designs. See Statistical Significance below.

Exclusions. Households reporting incomes that are zero or negative are excluded from estimates of worst case needs. However, they are included in counts of total households. If such households pay rents greater than the Fair Market Rent and report zero or negative incomes, then their income situation is presumably temporary, and so they are included and higher incomes are imputed to them.

Disclosure Review. The local income limits and HAMFI values that are required to estimate worst case needs are linked to local geographies and, therefore, pose a risk of disclosing AHS respondents. Accordingly, the analysis relies on restricted-access internal use files maintained at the Census Bureau’s Research Data Center. Tabulations are reviewed, and values are suppressed as necessary to comply with Census disclosure-prevention requirements under the authority of the Data Review Board. The Census Bureau reviewed this data product for unauthorized disclosure of confidential information and approved the disclosure avoidance practices applied to this release: CBDRB‑FY24‑0483.

Statistical Significance. Assessments of statistical significance in this report are made regarding 95-percent confidence intervals. Standard errors associated with estimates are estimated using AHS replicate weights and Fay’s “Balanced Repeated Replication” method in the SAS SURVEYMEANS statistical procedure. Changes between survey years are judged to be statistically significant if the difference between estimated values exceeds a critical value based on the square root of the sum of squared variances. A limitation of this method is that it is not robust to nonindependent samples inherent to the AHS panel design.

——————————————————————————————————————

76 The AHS Table Creator tool is found at https://www.census.gov/data/data-tools/ahs-table-creator.html. 77 The Comprehensive Housing Affordability Strategy datasets can be downloaded from

https://www.huduser.gov/portal/datasets/cp.html.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 99 Household and Family Types

In this report, the terms family and household are not interchangeable because not all households are families. The term families refers only to a subset of households that have one or more people in the household who are related to the householder (the first household member aged 18 or older who is listed as an owner or renter of the housing unit) by birth, marriage, or adoption.

Families With Children. Households with children younger than 18 are presumed to meet the definition of family through relation by birth or adoption, including grandparents as parents.

Older Adult Households Without Children. Households in which the householder or spouse is aged 62 or older and no children are present. Older adult households may be either family or nonfamily households.

Other Family Households. Households with people younger than 62 as a householder and no children, in which either (1) one or more people are related to the householder by birth, marriage, or adoption or (2) one or more subfamilies reside there who have members related to each other by birth, marriage, or adoption.

Other Nonfamily Households. Households with single people younger than 62 living alone or with only nonrelatives. Most of these households consist of a single person living alone rather than unrelated people sharing housing.

Households With People With Disabilities. Before 2009, no questions in AHS were designed to directly ascertain whether individuals had disabilities. Worst case needs reports for 2007 and earlier identified households containing people with disabilities using various forms of income-based proxies. Households with disabilities (1) were not families with children, (2) were not older adult households, and (3) received some form of income or government assistance that is very likely to indicate that an adult with disabilities is present in the household. The 2009 AHS and subsequent surveys ask direct questions about impairments and difficulties with activities of daily living for each household member, including children older than age 5. Therefore, this report addresses disability based on people reported with these problems, except that older adults who have disabilities do not increase the number of households counted with disabilities because so many disabilities are associated with aging.

Housing Assistance Status

In 1997, AHS questions intended to identify households receiving rental assistance were changed in both content and order from those used previously. After careful review, HUD and the Census Bureau adopted the following procedure to identify assisted households in a way that produces results that are more comparable with pre-1997 data. Those questions were further refined in 2007 as a result of additional cognitive research. In this report, therefore, receipt of rental assistance is based on respondent reports designed to determine the following:

• Whether the household must recertify to determine the rent it pays.

• Whether the rent is less because of a federal, state, or local government housing program.

• Whether the household has a housing voucher and, if so, whether it can be used to move

to another location.

• Whether the housing authority is the household’s landlord.

100 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

An alternative approach to identifying HUD-assisted households using an administrative data match is not used to determine housing assistance status for the purposes of this report because such an approach excludes assistance received from other federal, state, or local agencies.

Housing Problems

Rent or Cost Burden. A ratio of housing costs (including utilities) to household income that exceeds 30 percent, which is a conventional standard for housing affordability. To the extent that respondents underreport total income, AHS estimates may overcount the number of households with a cost burden. A severe cost burden exceeds 50 percent of reported income. A moderate cost burden exceeds 30 percent but is less than or equal to 50 percent of reported income. Cost burdens only qualify as potential worst case needs if they are severe. Households reporting zero or negative income are defined as having no cost burden.

Inadequate Housing. Housing with severe or moderate physical problems, as has been defined in AHS since 1984 and modified from time to time to reflect changes in the survey. Severe inadequacies constitute potential worst case needs, but moderate inadequacies do not. The 2007 AHS eliminated the questions about hallways (common stairways and light fixtures) in multi-unit structures in the section on selected physical problems, which affects the classification of units having severe or moderate physical problems. Briefly, a unit is defined as having severe physical inadequacies if it has any one of the following four problems.

1. Plumbing. Lacking piped hot water or a flush toilet or lacking both bathtub and shower,

all for the exclusive use of the unit.

2. Heating. Having been uncomfortably cold during the past winter for 24 hours or more, or

three times for at least 6 hours each, because of broken-down heating equipment.

3. Electrical. Having no electricity or having all the following three electrical problems:

exposed wiring, a room with no working wall outlet, and three or more blown fuses or tripped circuit breakers in the past 90 days.

4. Upkeep. Having any five of the following six maintenance problems: leaks from

outdoors, leaks from indoors, holes in the floor, holes or open cracks in the walls or ceilings, more than 1 square foot of peeling paint or plaster, and rats in the past 90 days.

A housing unit has moderate physical inadequacies if it has any of the following four problems but none of the severe problems listed previously.

1. Plumbing. Having all toilets break down simultaneously at least three times in the past 3

months for at least 3 hours each time.

2. Heating. Having unvented gas, oil, or kerosene heaters as the main source of heat

(because those heaters may produce unsafe fumes and unhealthy levels of moisture).

3. Upkeep. Having any three of the six upkeep problems associated with severe

inadequacies.

4. Kitchen. Lacking a sink, range, or refrigerator for the exclusive use of the unit.

Overcrowding. The condition of having more than one person per room in a residence. Overcrowding is counted as a moderate problem rather than a severe problem that constitutes a potential worst case need.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 101 Crowding is measured as the ratio of persons to total rooms. Total rooms is defined as the sum of whole rooms, including bedrooms, kitchens, dining rooms (if separate), and other finished rooms, including living rooms, family rooms, great rooms, TV rooms, recreation rooms, dens, and libraries. Spaces that are not counted in total rooms include full baths, half baths, laundry rooms, utility rooms, garages, hallways, closets, and porches.

“Priority” Problems. Problems qualifying for federal preference in admission to assisted housing programs between 1988 and 1996, including paying more than one-half of income for rent (severe rent burden), living in severely substandard housing (including being homeless or in a homeless shelter), or being involuntarily displaced. These problems informed the original definition of worst case needs. Because the AHS sample tracks housing units and thus cannot count people experiencing homelessness, AHS estimates of priority problems are limited to the two severe problems described previously: (1) rent burdens greater than 50 percent of income or (2) severe physical problems. In accordance with the intention to estimate the number of unassisted VLI renters with priority problems, the exhibits in appendix A classify households with a combination of moderate problems and severe problems as having severe problems.

Income Measurement

Income Sources. Income means gross income reported by AHS respondents for the 12 months preceding the interview. For each person in the household, the AHS questionnaire collects the amounts of several different types of income. Income includes amounts reported for wage and salary income, net self-employment income, Social Security or railroad retirement income, public assistance or welfare payments, and all other money income before deductions for taxes or any other purpose. Imputed income from equity is not included as income in this report. Following HUD rules for determining income eligibility for HUD programs, the earnings of teenagers aged 17 and younger are not counted as income for this report.

Household Income. Reported income from all sources for all household members aged 18 and older.

Income Categories

HUD Area Median Family Income (HAMFI) and Official Income Limits. HUD is required by law to set income limits each year that determine the eligibility of applicants for assisted housing programs. In 1974, Congress defined low income and very low income for HUD rental programs as incomes not exceeding 80 and 50 percent, respectively, of HAMFI. HAMFI is more commonly referred to as AMI, although the latter term may be subject to misinterpretation. Note that income limits are based on Median Family Income, not on median household income. HUD determines base income limits for a household of four and adjusts them further by household size: one person, 70 percent of the base; two people, 80 percent; three people, 90 percent; five people, 108 percent; six people, 116 percent; and so on. Each household is assigned to an income category using the HUD-determined income limit for its geographic area and number of

household members.78 The Quality Housing and Work Responsibility Act of 1998 (Pub. Law 105–276) first applied an extremely low-income (ELI) standard based on 30 percent of HAMFI for admissions targeting in public housing and the tenant-based Section 8 program. See ELI in the following.

——————————————————————————————————————

78 For details about how HUD sets income limits, see http://www.huduser.org/portal/datasets/il.html.

102 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Income Cutoffs in Association With AHS Geography. The Census Bureau matches AHS survey addresses with HUD income limit geography and assigns the appropriate income limits to each case, making the appropriate adjustments for household size.

Because developing estimates of official income limits for the geography identified in AHS microdata was time consuming, before the 2003 AHS release, HUD prepared income limits to use with AHS geography for only 3 years: 1978, 1986, and 1995. Income cutoffs for the 2003 AHS release and each subsequent dataset have been based on HUD’s current income limits for those years, weighted by AHS weights. The Census Bureau included those cutoffs in the AHS public use file through 2013. To protect respondent confidentiality, income limit variables were restricted to the AHS internal use file in 2015. Additional details about income limits can be found in the housing costs-affordability section of the AHS Codebook interactive tool (Census Bureau and HUD, 2023b).

Categorizing Households by Income. For this report, when households are categorized using the extremely low-, very low-, and low-income cutoffs, the cutoffs are adjusted for household size using the same adjustment factors that HUD programs use. See additional considerations under ELI in the following.

In addition, households reporting negative incomes are attributed to incomes of slightly more than AMI if their monthly housing costs exceed the Fair Market Rent (FMR) and they live in adequate and uncrowded housing. The justification for imputing higher incomes is that many households in this situation live in housing with amenities such as dining rooms, balconies, and off-street parking and thus may be reporting temporary accounting losses.

• Extremely low income (ELI). Income not in excess of 30 percent of HAMFI, as

determined by the ELI cutoff used for Section 8 programs. In 2014, Congress required HUD to begin setting ELI cutoffs for each area to the greater of 30 percent of HAMFI or

the federal poverty guidelines, but necessarily capped by the VLI cutoff.79 Because of this requirement, 78 percent of geographic areas had four-person ELI cutoffs set above 30 percent of HAMFI in 2019. The average increase in the cutoff among such areas was 32 percent, and for 3 percent of areas that were capped by the VLI cutoff, the increase was 67 percent. Because federal poverty guidelines use larger household size adjustments than HUD income limits, increases in the ELI cutoffs were both more likely and more substantial for large households than for small households.

• Very low income. Income not in excess of 50 percent of HAMFI, as determined by the

VLI cutoff. VLI thus includes ELI, although the term is sometimes used loosely in specific contexts, such as mismatch analysis, to mean incomes of between 30 and 50 percent of HAMFI.

• Low income. Reported income not in excess of 80 percent of HAMFI, as determined by

the low-income cutoff.

• Middle income. For this report, income exceeding 80 percent and less than 120 percent

of HAMFI.

——————————————————————————————————————

79 See Frequently Asked Question 4, https://www.huduser.gov/portal/datasets/il.html#2015_faq.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 103

• Upper income. For this report, income exceeding 120 percent of HAMFI. HUD allows

some jurisdictions exceptions in the definition of the ELI and VLI cutoffs. Those exceptions are intended to prevent the loss of benefits to assisted households caused by improvement in local economic conditions. Thus, the official income limits for ELI and VLI are, in some cases, set above 30 or 50 percent of HAMFI, respectively. AHS (and thus this report) uses those official income limits in all its measures.

• Poverty. Household income of less than the U.S. national poverty guidelines for that

household size. As discussed in appendix A of the Census Bureau’s AHS publications, AHS poverty estimates differ from official poverty estimates made from the Current Population Survey (Census Bureau and HUD, 2023a). AHS poverty estimates are based on the income of households rather than the income of families or individuals, and AHS income questions are much less detailed and refer to income during the past 12 months rather than during a fixed period. The poverty guidelines for a family of four approximate 33 percent of HAMFI. Comparisons of income limits with poverty thresholds are presented in exhibits A-6A, A-6B, A-7, and A-8.

• Earnings at minimum wage. Households with incomes from salary or wages totaling at

least as much as one could earn working full time (40 hours per week for 50 weeks per year) at the federal minimum wage of $7.25 per hour are defined as having at least full-time earnings at minimum wage. Thus, the sum of salary and wage income earned by all persons in the household totals at least $14,500 annually. Households with incomes from salary or wages totaling at least one-half of that amount ($7,250 annually) are defined as having at least half-time earnings at minimum wage. Comparisons of household earnings characteristics are presented in exhibits A-6A, A-6B, A-7, and A-8.

Location

Metropolitan Statistical Area (MSA). From 1973 to 1983, the definitions of metropolitan locations in AHS data corresponded to the 243 Standard MSAs used in the 1970 census. From 1984 to 2013, a metropolitan location in AHS referred to the MSAs defined in 1983, based on the 1980 census. The 2015 AHS redesign that selected a new national and metropolitan area longitudinal sample for the first time since 1985 brought metropolitan area definitions up to date with the most current Office of Management and Budget delineations based on the 2010 census,

which was February 2013 at the time the 2015 AHS sample design took place.80 These areas are now termed Core Based Statistical Areas.

Region. The four census regions are the Northeast, Midwest, South, and West.

Mismatch of Supply and Demand for Affordable Rental Housing

Mismatch. HUD assesses the state of the housing market by examining the extent of the mismatch between the supply of the rental housing stock and the number of renters whose household incomes fall below specified thresholds. Three summary measures are used to characterize the extent of mismatch at selected income levels:

1. Affordable units per 100 renters.

—————————————————————————————————————— 80 For more detailed information on 2015 AHS metropolitan areas, see

https://obamawhitehouse.archives.gov/sites/default/files/omb/bulletins/2013/b13-01.pdf.

104 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

2. Affordable and available units per 100 renters. 3. Affordable, available, and adequate units per 100 renters.

These mismatch measures can be understood as measuring the sufficiency of the quantity of housing supplied relative to the quantity of housing demanded. The italicized terms are defined and discussed in the following.

Affordability. Several federal rental programs define affordable rents as those requiring not more than 30 percent of an income cutoff defined concerning HAMFI. Under the Low-Income Housing Tax Credit (LIHTC) program, for example, housing units with rents up to 30 percent of 60 percent of HAMFI qualify as affordable and eligible for the credit.

This report generalizes the approach developed to define LIHTC maximum rents for units of different sizes to define three categories of affordability (ELI, VLI, and low income) based on incomes that are sufficient for the rents: at or less than 30 percent of HAMFI, more than 30 percent and not more than 50 percent of HAMFI, and more than 50 percent of HAMFI. Units are assigned to affordability categories by comparing their gross rent, including payments for utilities, with affordability thresholds calculated as 30 percent of the income cutoffs for the corresponding income group. Units with gross rents above those thresholds are not affordable because they would cause moderate or severe cost burdens even for the highest income renters of the income group. Thus, unit affordability depends on the percentage of HAMFI needed to afford the highest rent in each income category (ELI, VLI, and so on). For example, to be affordable to ELI renters, a unit’s gross rent would have to be 30 percent or less (affordability threshold) of 30 percent of HAMFI (ELI threshold). The method of assigning units to cost categories was modified in 2017 to account for limited HUD administrative exceptions to program income limits.

The income limits used to define rent affordability are adjusted for the number of bedrooms using the formula codified at 26 U.S.C. 42(g)(2)(C): no bedrooms, 70 percent of base; one bedroom, 75 percent; two bedrooms, 90 percent; three bedrooms, 104 percent; four bedrooms, 116 percent; and plus, 12 percent of base for every additional bedroom. This formula assumes that an efficiency unit houses one person, a one-bedroom unit houses 1.5 people, and each additional bedroom houses another 1.5 people.

Availability. For mismatch analysis, housing units that are affordable at a specified income level are further assessed for whether they are currently available to households at that income level. A unit is available if it is either already occupied by a household of that income level or currently vacant and available for rent. Units that are occupied by households of higher income groups are not “available.”

Adequacy. For mismatch analysis, housing units that are found to be both affordable and available at a specified income level are further assessed for whether they are free of severe physical inadequacies, as discussed under the Housing Problems heading.

Categorization of Rental Units and Households for Mismatch Analysis. To analyze the mismatch between affordability and income, HUD compares household incomes and housing unit rents with the current income limits (for income and rent categories up to and including 80 percent of HAMFI) and to a ratio of HAMFI (for categories exceeding 80 percent of HAMFI). As in the analysis of household income, households reporting negative income are redefined as having incomes slightly greater than the Median Family Income if their monthly housing costs

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 105 were more than the FMR and they lived in adequate and uncrowded housing. Units reported as having “no cash rent” are categorized solely on the basis of utility costs. Utility costs are allocated to vacant units through hot-deck imputation based on units that are comparable based on cost, number of units in the structure, region, and tenure.

Race and Ethnicity

In 2003, AHS began using revised Census Bureau categories of race and ethnicity that are not directly comparable with the categories used in AHS from 2001 and earlier. Survey respondents may now select more than one racial group, causing slight but meaningful decreases in the size of previously monolithic categories.

The 2017 AHS supports producing estimates of worst case housing needs for more detailed race and ethnicity categories than were included in previous reports. In addition to non-Hispanic White, non-Hispanic Black, and Hispanic renters, households experiencing worst case housing needs previously enumerated in an “other” race category are now reported for Asian, American Indian or Alaska Native, and Native Hawaiian or other Pacific Islander renters (exhibit 1-7).

Shift-Share Decomposition

HUD uses a structured method to separate demographics from market factors that contribute to the observed change in worst case needs from one year to the next and to decompose the effects of specific demographic components. This “shift-share” method is derived from regional economics, where it is used to decompose the observed changes in a specified economic sector of a region into the effects of national growth and industrial sector growth relative to regional competitiveness.

A change in worst case needs during a time period T1 to T2 can be decomposed into two broad components: a demographic effect and a prevalence effect. The demographic effect is the change in the demographic base of unassisted VLI renters (U—those who by definition are susceptible to worst case needs) times the new prevalence rate (R) of worst case needs among such households: (U2 – U1)*R2. The “prevalence effect” is the change in the prevalence rate times the former demographic base: (R2 – R1)*U1. (In a different accounting, computing a smaller “pure” demographic effect (U2 – U1)*R1 would enable separate consideration of a “joint effect” of interaction between the change in base and change in prevalence, (U2 – U1)*(R2 – R1)).

After the aggregate demographic effect and prevalence effect are determined, the demographic effect may be further decomposed into four nested factors. Each factor is sequentially assumed to affect the number of unassisted VLI renters in proportion to its percentage change between T1 and T2:

• Household Formation is the percentage change in the number of total households

(including from immigration).

• Tenure Shift is the percentage change in renter households, net of Household Formation.

• Income Shift is the percentage change in renters with very low incomes, net of Tenure

Shift.

• Rental Assistance Gap Shift is the percentage change in VLI renters who lack rental

assistance, net of Income Shift.

106 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Each factor’s estimated share of the change in the base of unassisted VLI renters is imputed to be its share of the total demographic effect on worst case needs.

Limitations. Such demographic decomposition has limitations arising from the assumption that each component has proportionate effects on its nested subcomponents. If this assumption is mistaken, then the bias in its attributed effect will be offset by opposing bias in the nested subcomponents. For example,

• Household formation might involve disproportionate numbers of unassisted VLI renters.

• Tenure shift might involve primarily renters with incomes above the VLI limit. • Income shift might affect assisted renters more than unassisted renters.

The interpretation of the prevalence effect also involves uncertainty. Because shift-share analysis treats the demographic factors affecting the base of unassisted VLI renters separately, the prevalence effect can be understood as the role of housing market dynamics and market response to the change in demand for affordable housing. Changes in the availability of affordable units for such renters, as measured by the VLI affordable and available mismatch ratio (units per 100 renters), frequently correspond to movement in the prevalence effect. However, changes in the prevalence of worst case needs also might result from internal changes in the distribution of income or rents among such renters or from other factors:

• Changes in the share of unassisted VLI renters who have ELIs.

• Changes in the distribution of income or rents internal to ELI and 30–50 percent of AMI

subgroups.

• Rent increases that affect the availability of ELI units in mismatch analysis without

affecting the availability of very low-income VLI units or that mismatch analysis does not capture because the top of each income group defines affordability categories.

• Affordable units in mismatch analysis that are “available” on a national basis but are in

the wrong areas or have the wrong size to serve the households needing such units.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 107 Literature Cited

Börsch-Supan, Axel. 1986. “Household Formation, Housing Prices, and Public Policy Impacts,” Journal of Public Economics 30 (2).

https://www.sciencedirect.com/science/article/pii/0047272786900423.

Camarota, Steven A. 1998. The Wages of Immigration. Washington, DC: Center for Immigration

Studies. https://cis.org/sites/cis.org/files/articles/1998/wagestudy/wages.pdf

Choi, J. et al. 2018. Millennial Homeownership: Why Is It So Low, and How Can We Increase

It? Urban Institute. https://coilink.org/20.500.12592/0k7z84.

Davis, Morris A., Stephen D. Oliner, Tobias J. Peter, and Edward J. Pinto. 2020. “The Impact of Federal Housing Policy on Housing Demand and Homeownership: Evidence from a Quasi-Experiment,” Journal of Housing Economics 48.

https://www.sciencedirect.com/science/article/pii/S1051137719300075.

Devaney, F. John. 1994. Tracking the American Dream. Washington, DC: U.S. Department of

Commerce. https://www.huduser.gov/portal/Publications/pdf/HUD-7775.pdf.

Divringi, Eileen, Eliza Wallace, Keith Wardrip, and Elizabeth Nash. 2019. Measuring and Understanding Home Repair Costs: A National Typology of Households. Philadelphia: Federal

Reserve Bank of Philadelphia. https://www.philadelphiafed.org/-/media/frbp/assets/community-

development/reports/measuring-and-understanding-home-repair-costs/0919-home-repair-costs-

national-report.pdf.

Edo, Anthony. 2015. “The Impact of Immigration on Native Wages and Employment,” The B.E.

Journal of Economic Analysis & Policy 15 (3). https://doi.org/10.1515/bejeap-2014-0075.

Eggers, Frederick J., and Fouad Moumen. 2016. American Housing Survey Components of Inventory Change: 2011–2013. Washington, DC: U.S. Department of Housing and Urban Development, Office of Policy Development and Research.

https://www.huduser.gov/portal/datasets/cinch/cinch13/cinch11-13.pdf.

Eriksen, Michael D. 2010. Homeownership subsidies and the marriage decisions of low-income households, Regional Science and Urban Economics, 40 (6).

https://www.sciencedirect.com/science/article/pii/S0166046210000487

Mussa, Abeba, Uwaoma G. Nwaogu, and Susan Pozo. 2017. “Immigration and Housing: A Spatial Econometric Analysis,” Journal of Housing Economics 35.

https://www.sciencedirect.com/science/article/pii/S1051137717300025.

Myers, Dowell, and Cathy Yang Liu. 2006. “The Emerging Dominance of Immigrants in the U.S. Housing Market 1970–2000,” Urban Policy and Research 23 (3): 347–366.

https://www.tandfonline.com/doi/abs/10.1080/08111470500197920.

Nisar, Hiren, Mallory Vachon, Charles Horseman, and Jim Murdoch. 2019. Market Predictors of Homelessness: How Housing and Community Factors Shape Homelessness Rates Within Continuums of Care. Washington, DC: U.S. Department of Housing and Urban Development, Office of Policy Development and Research.

https://www.huduser.gov/portal/sites/default/files/pdf/Market-Predictors-of-Homelessness.pdf.

108 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

Orrenius, Pia M., and Madeline Zavodny. 2007. “Does Immigration Affect Wages? A Look at Occupation-Level Evidence,” Labour Economics 14 (5): 757–773.

https://www.sciencedirect.com/science/article/abs/pii/S0927537106000674.

Saiz, Albert. 2007. “Immigration and Housing Rents in American Cities,” Journal of Urban

Economics 61 (2). https://www.iza.org/publications/dp/2189/immigration-and-housing-rents-in-

american-cities.

Solari, Claudia D., and Robert D. Mare. 2012. “Housing Crowding Effects on Children’s

Wellbeing,” Social Science Research 41 (2): 464–476. doi:10.1016/j.ssresearch.2011.09.012.

Susin, Scott. 2002. “Rent Vouchers and the Price of Low-Income Housing,” Journal of Public

Economics 83 (1). https://www.sciencedirect.com/science/article/abs/pii/S0047272701000810.

U.S. Census Bureau and U.S. Department of Housing and Urban Development (Census Bureau and HUD). 2013. “Appendix B. 2013 AHS National Sample Design and Weighting.” In American Housing Survey for the United States: 2013. Washington, DC: U.S. Department of

Commerce, Census Bureau. https://www.census.gov/programs-surveys/ahs/tech-

documentation/def-errors-changes.2013.html.

———. 2017. 2015 AHS Integrated National Sample: Sample Design, Weighting, and Error Estimation. Washington, DC: U.S. Department of Commerce, Census Bureau and HUD.

https://www2.census.gov/programs-

surveys/ahs/2015/2015%20AHS%20National%20Sample%20Design,%20Weighting,%20and%2

0Error%20Estimation.pdf.

———. 2023a. “Appendix A. Subject Definitions and Table Index.” In American Housing Survey for the United States: 2023. Washington, DC: U.S. Department of Commerce, Census

Bureau. https://www2.census.gov/programs-

surveys/ahs/2023/2023%20AHS%20Definitions.pdf.

———. 2023b. “AHS Codebook.” U.S. Census Bureau. https://www.census.gov/data-

tools/demo/codebook/ahs/ahsdict.html.

———. 2024. 2023 AHS Integrated National Sample: Sample Design, Weighting, and Error Estimation. Washington, DC: U.S. Department of Commerce, Census Bureau and HUD.

https://www2.census.gov/programs-

surveys/ahs/2023/2023%20AHS%20National%20Sample%20Design,%20Weighting,%20and%2

0Error%20Estimation.pdf.

U.S. Department of Housing and Urban Development (HUD). 2008. Housing Needs of Persons With Disabilities: Supplemental Findings to the Affordable Housing Needs 2005 Report. Washington, DC: HUD, Office of Policy Development and Research.

https://www.huduser.gov/portal/Publications/pdf/Affhsgneedsdis.pdf.

———. 2023. Programs of HUD: Major Mortgage, Grant, Assistance, and Regulatory Programs: 2023. Washington, DC: HUD.

https://www.hud.gov/sites/dfiles/Main/documents/HUDPrograms2023.pdf.

———. 2024. The 2024 Annual Homeless Assessment Report (AHAR) to Congress: Part 1: Point-in-Time Estimates of Homelessness. Washington, DC: HUD, Office of Community

Planning and Development. https://www.huduser.gov/portal/sites/default/files/pdf/2024-AHAR-

Part-1.pdf.

WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS 109 Wallace, Eliza, Eileen Divringi, and Keith Wardrip. 2019. “A New Cost-Based Index of Housing Quality and Repair Needs,” Cityscape 21 (3): 299–309.

110 WORST CASE HOUSING NEEDS 2025 REPORT TO CONGRESS

U.S. Department of Housing and Urban Development

Office of Policy Development and Research

Washington, DC 20410-6000

November 2025

Table of Contents

Executive Summary ..................................................................................

WORST CASE NEEDS REMAIN UNCHANGED FROM THE RECORD HIGH OF 2021

PREVALENCE OF WORST CASE NEEDS ACROSS DEMOGRAPHIC GROUPS AND

DEMOGRAPHIC AND MARKET FACTORS SHAPE THE PERSISTENT SHORTAGE OF

CONCLUSION..........................................................................................

Section 1. Extent and Nature of Worst Case Needs ........................................ 1

INADEQUATE INCOME AND INADEQUATE HOUSING ........................................ 3

PREVALENCE OF WORST CASE NEEDS BY INCOME ......................................... 5

DEMOGRAPHICS OF WORST CASE NEEDS ....................................................... 6

WORST CASE NEEDS BY HOUSEHOLD TYPE ................................................. 11

HOUSEHOLDS THAT INCLUDE PEOPLE WITH DISABILITIES ........................... 15

OVERCROWDING AND WORST CASE NEEDS .................................................. 17

SUMMARY ............................................................................................

Section 2. The State of Affordable Housing ................................................... 21

VARIATION IN WORST CASE NEEDS BETWEEN METROPOLITAN MARKETS... 26

FACTORS LIMITING ACCESS TO AFFORDABLE RENTAL HOUSING ............... 29

ADVERSE IMPACT OF DEMAND-SIDE HOUSING SUBSIDIES ............................ 30

HOW THE MARKET ALLOCATES AFFORDABLE HOUSING ON A NATIONAL

AFFORDABILITY, AVAILABILITY, AND ADEQUACY OF THE NATIONAL RENTAL

RENTAL STOCK BY INCOME .......................................................................... 36

GEOGRAPHY OF SUPPLY ................................................................................

RENTAL STOCK BY METROPOLITAN LOCATION ............................................ 38

Section 3. Understanding the Trend in Worst Case Needs .......................... 42

OTHER FACTORS AFFECTING AFFORDABLE HOUSING SUPPLY AND DEMAND45

CONCLUDING SUMMARY ................................................................................

Appendix A. Detailed Data on Housing Problems and Supply of Affordable

Appendix B. Supplemental Exhibits ............................................................... 93

Appendix C. Federal Housing Assistance and Affordable Housing Programs

Appendix D. Previous Reports to Congress on Worst Case Needs.............. 97

Appendix E. Data and Methodology .............................................................. 98

HOUSEHOLD AND FAMILY TYPES ................................................................ 100

HOUSING PROBLEMS ...................................................................................

INCOME MEASUREMENT .............................................................................. 10

LOCATION ...........................................................................................

RACE AND ETHNICITY .................................................................................

Literature Cited ...................................................................................

1011

16

18

24

25

26

27

30

31

35

40,41

42

44

51