How Washington’s housing situation compares with other cities

November 25, 2012

Delta Associates recently analyzed the region’s housing characteristics for a D.C. housing strategy task force, comparing the Washington area to Atlanta, Austin, Boston, Denver, Minneapolis and Seattle, and their surrounding areas.

The District is a more transient city than those other locales, given its proximity to federal power. As a result, the homeownership ratio here is lower than all of the other cities except Boston. (Boston is a major college town, which also lends itself to being a transient city.)

Although the District’s rental share of housing may be temporarily high because of the recent national housing bubble and recession, it is likely to remain higher than national averages even after today’s younger renters age, get married and have children.

That’s because the District has the highest share of single-person and single-female-headed households among the communities studied. Over 44 percent of District households are singles living alone, higher than all other comparable cities, but similar to Seattle. In addition, more than 16 percent of District households have females as the lone head of household, higher than all other comparable cities. The higher share of single-person households is one reason why many new projects here include larger shares of studios and smaller apartments.

More than 42 percent of households in the District are considered to be cost-burdened — spending more than 30 percent of their income on housing. However, four of the six other cities examined are more cost-burdened, with Boston being the most cost-burdened. In all cities and metropolitan areas, homeowners are less cost-burdened than renters.

According to analysis of census data, there is a shortage of housing affordable to households with incomes below 30 percent of area median income in all of the cities Delta examined.

In the District, there is a small surplus of housing affordable to households with income in the 50-60 percent and 80-120 percent median income range, equating to 3 percent of the total inventory of rental units. Atlanta and Boston have shortages in the 30 to 50 percent category while Austin, Denver, and Minneapolis have shortages in the 80 to 120 percent area.

The Washington area also has a higher share of homeless individuals than the other areas. More than 2 percent of the Washington area’s population was homeless as of 2010, a rate more than six times higher than the Seattle metropolitan area, which has the next-highest share of homeless people. Just over 1 percent of the District’s population is homeless.

While household incomes are higher in the District than in the other cities, housing is also less affordable than most places, making homeownership more difficult to achieve. Higher-income renters generally pay less for housing than what their income allows, while those at the lower end of the income spectrum are left with a shortage of affordable housing.

William Rich is senior vice president at Delta Associates. Staff at Delta Associates contributed to this article. For more information, please visit www.deltaassociates.com.

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