Why Housing Bonds Now?

Austin has become the least affordable place to live in Texas. Our average home price is the highest in the state and has risen faster than elsewhere (Tx Real Estate Center.) Yet our wages have not risen as fast. By 2000, 37,586 city households were paying more than half of their monthly income for housing in 2000 (Census 2000.)

The gap between housing costs and incomes continues to grow:

• Divergent trends: Between 2000 and 2003, median incomes fell 14%, while rents fell only 4.3%. At the same time, home sales prices have risen 11.2% (Source: ACS, 2004)
  
• Growth in low wage jobs: 37 percent of jobs to be added by 2010 have average wages of $18,330 or less. By 2010, nine of the most common jobs in the region, employing close to 110,000 people, will offer median wages well below those needed to either own or rent a home. (TxWorkforce Commission projections and wage data, CHP housing data.)
  
• Housing Wage Highest in State. To afford to 2 bedroom apartment requires full time work at $17.54/hour in Austin—higher than any other city in the state.

Lowest income, Latino residents are especially hard hit:

• Budget squeeze. 23,424 renter households with incomes below $29,450 in 2000 paid more than half their income for housing, leaving a family of four $1200 per month to cover all other expenses. (HUD, CHAS, 2000. or cite Figure 2q in Con Plan, 2-15.)
• Lack of options. 4500 households are on the waiting list for Housing Choice Vouchers; 4,026 families were on the waiting list for Public Housing (HACA, 4/26/04, cited in Con Plan, 2-42.)
  Homelessness. 3761 people are estimated to be homeless in Austin—of these, 587 are chronically homeless (ECHO)
• Latino households overrepresented in statistics on housing problems. 70% of very low income elderly Latino renters and 36% of low income elderly Latino owners faced either high costs or poor conditions in 2000, according to HUD. (Con Plan, 2-11.)

Homeownership out of reach for many:

• Low city homeownership rate: Only 48 percent in 2002, compared to 64 percent for Texas as a whole. Homeownership was especially low for African-Americans (37.2%) and Latinos (36.3%.) (ACS, 2000 cited in Con Plan, 2-7.)
• Discrimination in home mortgage lending: Austin ranked second of 20 cities in a national study of lending discrimination, after New York. One-quarter of African-Americans and 32 percent of Hispanic buyers locally faced discrimination (AAS, 11/10/02.)
• Subprime lenders target minority neighborhoods. Residents of minority neighborhoods more likely than similar residents of white neighborhoods to pay higher interest rates and fees on loans, making it harder to build home equity. Austin ranked 9th of 117 studied (Austin Business Journal, 3/15/2004.)