What is driving homelessness in our communities?

What is driving homelessness in our communities?
Compiled from reports by the Washington Low Income Housing Alliance

Homelessness is a Local Problem
In 2005, homelessness in Washington State began a steady decline.  This was a result of investments in homeless and housing services funded by the Homelessness Housing and Assistance Act surcharge and affordable housing built with state Housing Trust fund investments[1]. However, 2013 marked a turning point towards a new rise in homelessness. During the 2016 Point in Time count, 20,844 people were counted as experiencing homelessness across Washington State. While Washington has seen significant population growth in recent years, population growth resulting from people moving to Washington is not a significant driver of homelessness. From 2012 to 2014, there was only 2% rise in people served in our homeless system from out of state.[2] The largest population served in the state’s homeless system, over 90%[3], is Washington residents. According to data from the Department of Commerce, the vast majority of households, 84%, received homelessness services in the county where they resided before experiencing homelessness.

The Real Drivers of Homelessness

Population growth has not has a significant effect on the growing number of people experiencing homelessness in Washington. Rather, the rise in homelessness is driven by a number of factors created by an out-of-reach rental market, stagnant wages, and barriers to accessing the for-profit rental market.

1. Affordability and Availability. Washington’s apartment vacancy rate hit a record low of 3.0% in 2016[4]. This record low vacancy rate coupled with a 6.6% increase in rent for a one-bedroom apartment between 2015 and 2016 has caused housing to become increasingly out or reach[5]. A recent study published in the Journal of Urban Affairs found that every $100 increase in rent is associated with a 6% increase in homelessness in metropolitan areas and a 32% increase in homelessness in non-metro areas, such as suburban communities[6]. Washington’s rental market places a heavy burden on households at or below 30% of Area Median Income (AMI). For every 100 households at or below 30%, there are only 29 affordable and available rental units statewide. Overall, our state has a deficit of 165,764 affordable and available units at or below 30% AMI.[7]

2. Stagnant Wages. Although the cost of rent has dramatically increased, wages in Washington remain stagnant or, in some cases, have decreased. According to the National Low Income Housing Coalition, workers need to earn $18.39 an hour in order to afford a one-bedroom apartment in our state, Washington’s current minimum wage is $11.00.[8] Despite the need for wages to be increased, low income households have seen a 7% decrease in their income while median rent across Washington rapidly rises.[9] The passage of Initiative-1433 in November 2016 will help mitigate this gap by increasing Washington’s minimum wage to $13.50 per hour over the next three years.

3. Barriers to the Rental Market. Households living on low incomes often face significant barriers that prevent them from obtaining a home, beyond the high cost of rent. In the majority of Washington, it has been legal for landlords to discriminate against tenants who pay for rent with subsidies, such as section 8 Housing Choice Voucher. Discrimination becomes more prevalent when vacancy rates are low. This form of discrimination is frequently exacerbated by other barriers to private rental housing, including the high cost of repeat tenants screening fees, rental application fees, and blanket rental bans against people with criminal records.

Steps to Reduce Homelessness and Expand Access to Affordable Housing

In this time of rising homelessness and sky-high housing costs across Washington, the state legislature has demonstrated extraordinary leadership and bipartisan support for solutions to the housing affordability and homelessness crisis across our state. On March 8 our state legislature ended its 2018 legislative session having made unprecedented and significant progress on solutions to the housing affordability and homelessness crisis in our state. 

Here are highlights of some of the key successes:

Increased funding for affordable homes and homelessness assistance

$107 million in the Biennial Capital Budget for the Housing Trust Fund. 
The Housing Trust Fund builds and preserves affordable homes. It primarily serves people with the lowest incomes and those with special needs, including people with disabilities, families with children who are homeless, seniors, youth and young adults, and veterans. This investment will create approximately 3,500 affordable homes.

House Bill 1570 helps an additional 11,500 people who are homeless or at risk of homelessness access housing assistance and services. This is funded by a $22 increase to a fee that is paid when real estate documents are filed, such as those signed to close on a new home purchase. This is the state’s primary source for funding homelessness services and is split between the state and counties so local communities can quickly address their most pressing needs. The increase will generate approximately $26 million each year to fight homelessness. Additionally, this bill removes the expiration date on the fee so that communities have a permanent and reliable source of funding to reduce homelessness.

Removing barriers to housing and preventing more people from falling into homelessness

Banning source of income discrimination (House Bill 2578) 
After more than a decade of advocacy, when this bill goes into effect, landlords will no longer be allowed to refuse to rent to someone just because they use rental or income assistance to help pay the rent. The bill also creates a mitigation fund to reimburse landlords for improvements necessary to rent to households with certain housing assistance, and provides landlords access to funds if there are damages beyond normal wear and tear.

Associated Ministries will continue to share ways that we can join with organizations like the Washington Low Income Housing Alliance to be part of the movement for safe, healthy, affordable homes… which is the ultimate solution to homelessness! Please attend our next Community Quarterly Meeting on March 22 to learn more.

[1] These investments have reduced homelessness by 17.6% since 2006 per data provided by the WA State Department of Commerce.
[2] Data provided by the Washington State Department of Commerce
[3] Ibid
[4] Runstad Center for Real Estate Studies, Apartment Market Survey 2016
[5] National Low Income Housing Coalition, Out of reach Report 2016
[6] Byrne, T., E.A., and Culhane, D.P. (2013), New Perspectives on Community-Level Determinants of Homelessness. Journal of Urban Affairs, 35: 607-625. doi: 10.1111/j.1467-9906.2012.00643
[7] National Low Income Housing Coalition, The Gap Report 2016
[8] Ibid
[9] Data Provided by the Washington State Department of Commerce