The past two installments of the four-part housing education series have defined the housing crisis and the economic policies that sustain it. Restrictive zoning laws, a struggling construction industry, and decades of a lack of investment in affordable housing have brought us here, but current policies continue to deepen the crisis. Today, we’ll look at the factors that are making the housing crisis worse.
Aging housing stock
The last installment of the housing education series showed that Missouri has under-invested in affordable housing for decades. Currently, 53% of the housing stock in Missouri was constructed before 1978, leading tenants to bear the cost burden that is common with substandard housing – childhood asthma, lead poisoning, physical injuries, and carbon monoxide poisoning. In 2018, the economic burden to Missouri from asthma alone was $34 million dollars. Additionally, it is estimated that more than 9,000 housing units do not have adequate indoor plumbing and 40,000 do not have kitchens. Older homes are also less energy efficient, leading to higher utility costs. Missouri households pay an average of $1,900 a year for utilities – $100 more than neighboring states.
Investing in the construction and rehabilitation of safe and affordable housing provides economic benefits for our communities as a whole. Studies show that when households have access to safe and affordable housing, they experience less depression, anxiety, and children’s emergency room visits than households without safe and affordable housing. Rebuilding Together found that for every dollar we invest in a home, $2.84 is generated in social benefits – such as independent living, lower medical costs, and savings for taxpayers.
Corporate profits over tenant rights
As we discussed previously, the 2008 housing market crash caused a higher rate of foreclosures, less homeownership, and subsequently, an increase in the number of households that rent. One group that has capitalized on this shift are large developers. A 2023 study done in Kansas City, MO found that twenty percent of the more than 150,000 single family rentals are owned by developers and companies with ten or more properties. Overall, five companies own nearly 8,000 rental properties in the Kansas City area. While some of the developers say that they are providing affordable housing, tenants state that they are not maintaining them, leading to unsafe and unsanitary living conditions. In a three-year period tenants filed more than 470 complaints to the Better Business Bureau against a single large developer that owns 2,400 properties in St. Louis and another 1,200 in Kansas City. These large, often out-of-state, developers have neglected properties in other parts of the states such as Springfield where a study showed that investors owned up to 26% of single-family homes in the city, and nearly 17% of these homes were in poor condition.
While tenants can withhold rent if repairs are not being completed, this is limited to one-half of one-month’s rent or $300, whichever is greater. The burden is on the tenant to prove a repair is justified and the process is often too slow to ensure they have safe and healthy housing. However, eviction proceedings tend to move quickly and favor landlords, due to tenants not having legal representation. Before the implementation of Right to Counsel in Kansas City, only 1.3% of tenants had legal representation at eviction court hearings while 82% of landlords did. This resulted in 99% of tenants being evicted.
When looking at the combination of large developers buying up housing stock in Black neighborhoods and lower-income areas along with less tenant protections, it should not be surprising to see that Black households, most notably Black women, face the highest levels of evictions – 28.3% of eviction filings – the highest of any represented group. Evictions have lasting impacts, beyond the loss of housing, including increasing the chances of homelessness. Studies show that for a year after being evicted the likelihood of using emergency shelter increases 3.4%. These numbers are even higher for Black and female tenants, 5.7% and 6.8% respectively, for up to two years following an eviction.
Legacy of racist housing policies
Racial disparities are not only seen with evictions, but in all aspects of housing. Black households are often steered towards housing in lower-income and less resourced areas, which were created due to redlining. Redlining was a way to steer investments away from certain areas – often predominantly Black. However, now large investors are using redlining to purchase up the housing stock for a low price and rent substandard housing to these communities for higher rental prices.
Misperceptions about low-income households
The current housing market is impacting many households, but the households with the lowest incomes are the most impacted– 87% of the lowest income households pay more than 30% of their income on rent and utilities. Misperceptions about low-income households create additional barriers. Source of income discrimination, such as a refusal to accept Housing Choice Vouchers, makes it extremely difficult for low-income renters already at risk of homelessness to find housing. A 2018 study funded by the US Department of Housing & Urban Development and conducted by the Urban Institute showed that over 67% of landlords refused to rent to voucher-holders in cities without source of income anti-discrimination laws. In comparison, less than 31% of landlords refused to rent to voucher holders in cities with source of income discrimination bans in place. There is a perception by landlords that voucher-holders will not be good tenants, but research has shown the opposite:
- Voucher-holders have strong incentives built into the program to be good tenants. Many families receiving housing vouchers waited years to receive rental assistance, which only reaches 1 in 4 eligible families. These families are at risk of losing their voucher if they damage the unit, do not pay rent on time, or commit other lease violations that could lead to an eviction.
- Voucher-holders are stable, long-term tenants. Tenants who use vouchers stay in the same unit an average of 6 years.
It’s time for Missouri to change course
All of these factors, combined with cuts to federal housing programs, are causing rising rents and more strain on tenants, with no improvements in the quality of their housing. I’ve spoken with many tenants in Missouri who say the same thing: “My rent went up and I have nothing better to show for it.” The quality of housing is declining as rent is increasing, and current policies offer limited or no protections to prevent these issues. As Missouri continues to see higher than average rent increases and increases in homelessness, it’s time to look at the policies in place that sustain this crisis and imagine better policies to improve the housing landscape for more households. In our next piece in this series, we’ll be discussing those solutions.
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