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Surprise! (To, Probably, No One) Southern California Is America's Most 'Cost-Burdened' Housing Market

An apartment for rent in Central Los Angeles. (Matt Tinoco/LAist)
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It's no secret that housing costs in Los Angeles and Orange counties are high compared to the pay most people take home.

In fact, housing costs are so high here that when it comes to paying for housing, local residents are the most "cost-burdened," according to researchers at Harvard University. That's in the entire nation.

Overall, 46% of all households in the two counties pay more than more than 30% of their income for the roof over their heads. When we say "cost-burdened" that's what we mean. It's a standard set by the U.S. Department of Housing and Urban Development (HUD).

Even more concerning, are the 24% of all households here considered to be "severely cost-burdened," meaning they pay more than half of all income to stay housed. How do renters compare to homeowners?

  • 31% of all renters in L.A. and Orange counties pay half of their income or more on housing
  • 16% of property owners do the same.

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Is it getting worse? The Harvard study reports the percentages have stayed relatively consistent in recent years. They've actually dropped slightly compared to the peak around 2010. At that time, about 51% of all households in L.A. and Orange Counties were "cost-burdened."


What is changing, however, is the availability of low-cost rental units.

That's become a bigger problem as property owners raise rents to match the going market rate. Between 2011 and 2017, researchers found the number of housing units available in the region available for less than $800 a month dropped from 412,623 units to 270,332.

$800 probably doesn't sound like that much if you are paying a mortgage or renting a home that's closer to the market rate. But there are literally hundreds of thousands of people living in Southern California in households where an $800 monthly rent payment would take up nearly all available income.

Consider this startling statistic produced by Economic Roundtable last year: in Los Angeles County alone, approximately 600,000 people are in living situations where 90% or more of all household income is spent on housing.

These numbers are the larger economic backdrop to the region's spiraling homelessness and affordability crisis. As long as a huge proportion of the region's population remains in living situations where most of their household income gets spent on housing, there are going to be people falling into homelessness.

A recent estimate by the California Housing Partnership figured meeting the need for low-income, below-market-rate housing in Los Angeles County alone would require about 516,000 more units than we actually have.

It's true that there are publicly-funded grants that enable developers to build this type of housing, the amount of need far eclipses the amount of subsidy available.

And keep in mind that many development deals only guarantee affordable units for a set period of time.

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