How should we measure North Carolina’s affordable housing crisis?

<p>How much should North Carolina families pay for housing? Affordable housing experts generally agree that housing costs should not exceed 30% of a household’s annual income. This payment standard is applied to nearly every major housing program, including public housing, housing choice vouchers, and properties financed through the Low-Income Housing Tax Credit. In each of these programs, rents are set based on the assumption that they should not exceed 30% of a tenant’s annual income.</p> <p>There are practical benefits to setting housing affordability at 30% of household income. The measurement is easy to calculate and communicate to tenants, developers, and other stakeholders in the affordable housing development process. But there are significant shortcomings as well. The threshold ignores household characteristics that make it more challenging to pay rent in addition to other non-housing expenses.</p> <p>For example, consider two households that each make $30,000 annually. Under the existing affordability standard, each household should pay no more than $750 on housing, with $1,750 leftover for other expenses such as health care, food, or transportation. Each household might have different circumstances that impact these expenses. One household might be made up of one adult and three kids, while another may only have a single working-age adult. For the family of four, their residual income will unlikely cover the additional food, health care, or childcare expenses. Both households live in “affordable” housing according to federal housing policies even if the family of four lacks residual income sufficient to cover other expenses.</p> <p>How should we measure housing affordability to better capture families’ individual [...]</p>