NLIHC President and CEO Diane Yentel served as a witness at a U.S. House of Representatives Committee on Financial Services Subcommittee on Housing and Insurance hearing, “Housing Affordability: Governmental Barriers and Market-Based Solutions,” on December 6. The hearing examined the role of market-based solutions in responding to the affordable housing crisis and the ways that government regulations can impede these solutions.
Other witnesses included Seth Appleton, president of U.S. Mortgage Insurers; Norbert Michel, vice president and director of Center for Monetary and Financial Alternatives at the CATO Institute; Dr. Emily Hamilton, senior research fellow and director of the Urbanity Project at the Mercatus Center at George Mason University; and Arianna Royster, president of Borger Residential, on behalf of the National Apartment Association (NAA).
In their opening statements, both Subcommittee Chair Warren Davidson (R-OH) and Ranking Member Representative Ayanna Pressley (D-MA) acknowledged the rising gap between the cost of housing and what workers are paid. “Renters are now the most cost-burdened they’ve been in over two decades,” said Chair Davidson. “While rents have gone up – in some areas by double-digit growth – median income for renter households actually went down between 2019 and 2021.”
“Millions of renter households are cost-burdened, spending elevated amounts of income on housing,” said Representative Pressley. “Central to the question of how to address the affordable housing crisis is answering the question: affordable to whom? To close the affordable housing gap for low- and moderate-income households, there needs to be assistance for both development and rental income.”
Diane provided additional context in her opening remarks, emphasizing the disproportionate impact of the affordable housing crisis on individuals and families paid the lowest wages. “Housing costs are out of reach for too many of the lowest-income renters,” she stated. “Rents are far higher than what the lowest-income and most marginalized renters – including seniors, people with disabilities, and working families – can spend on housing.” Diane also noted that the affordable housing shortage is fundamentally caused by market failures and the chronic underfunding of solutions, noting that “despite the clear and urgent need, Congress only provides housing assistance to one in four eligible households.” Without sufficient federal investments, millions of the lowest-income households spend more than half of their incomes on their housing, leaving them “one financial emergency away from not being able to pay the rent, facing eviction, and possible homelessness.”
Representative Bill Posey (R-FL) praised panelists for “[bringing] forth some really good suggestions for improvements” to spur the construction of affordable housing and wondered “if Congress could do just one thing” to address homelessness, “what would that one thing be?”
“Ending homelessness would require making homes affordable to people with extremely low incomes, which would require subsidies in the form of rental assistance, expanded Section 8 vouchers, preserving and expanding public housing programs, and other affordable housing solutions for the lowest-income people,” said Diane in response. “Creating and accessing these types of housing services – with wrap-around supports – has been shown again and again in the research to be highly effective at ending homelessness.”
Watch a recording of the hearing, read witnesses’ testimony, and view the Committee Memorandum here.