One question we received from a reader named Amanda is this: “How has the ratio of affordable housing in the area kept pace (or not kept pace) with the population increase?”
The short answer is that publicly-subsidized affordable housing has kept pace, but it hasn’t been nearly enough to overcome the lack of affordable housing in the free market. Confused? Let us explain…
RENTS ARE RISING FASTER THAN INCOMES
The vast majority of Portlanders pay rent at market rate, without any public assistance — and they’re feeling the squeeze.
By comparison, average incomes only rose about 7 percent during that time, and if it weren’t for an influx of wealthy transplants and the displacement of many low-income residents, that number would be even lower.
It’s true that rents in Portland are starting to stabilize, but the long-term trend hasn’t changed: Across the board, Portlanders are spending a higher share of their income on rent than they were a decade ago.
So what’s to blame? Let’s start with the primary offender.
NOT ENOUGH HOUSING
The biggest driver of rising rents in Portland is supply and demand, and there’s no better case study than what happened during the Great Recession.
The region’s population jumped about 7 percent between 2010 and 2015, while new housing construction slowed to a crawl due to the poor economy.
The result: more people found themselves competing for essentially the same amount of housing, and just like your Econ 101 prof would have predicted, prices went through the roof.
Construction in Portland has rebounded since then (can you tell from all the cranes?), but it’s been too little too late to reverse the city’s affordability crisis. And that’s why Portlanders are looking to government to help plug the gap.
ENTER THE PUBLIC SECTOR
The two biggest public programs for affordable housing — housing vouchers and rent subsidies — have both expanded in Portland over the last decade.
Between 2007 and 2017, the number of Section 8 housing vouchers used in the Portland area increased by 27 percent, from 12,921 to 16,395.
Meanwhile, the number of government-subsidized or “regulated” affordable housing units grew 25 percent, from 35,136 to 43,956.
The giant caveat here is that not all of this affordable housing is affordable for everyone. In reality, housing bureaus spend a lot of their money making apartments affordable for families earning $35,000 a year (or about 80 50 percent of median family income), even though the biggest need is among families making $25,000 or less.
Still, the overall trend is positive, and the Metro affordable housing bond that voters approved last week will only help. We’ll have more on that soon.