The Huffington Post
By: Alexander Eichler
January 18, 2012
Homeless rate ready to rise as stimulus cash runs out: Study
Although the recession has officially been over for two years, the worst may be to come for many people.
Job losses rose during the last few years. So did wages -- barely. Foreclosures went up, as did the number of poor people for whom rent eats up at least half the paycheck. And a federal program believed to have made a major difference in keeping homeowners off the streets is due to expire in a few months.
All in all, the conditions are right for national homeless rates to start rising soon, according to a new report that examines many of the large-scale economic factors that force people out of their homes. The report, published Tuesday by the National Alliance to End Homelessness, suggests that a delayed wave of pain may be coming for low-earning renters and homeowners.
"It takes a while for people to become homeless," said Nan Roman, president and CEO of the National Alliance to End Homelessness, a Washington, D.C.-based nonprofit. "They don't enter the shelter right away."
"We are very concerned that homelessness is going to go up," Roman added.
For homelessness to start climbing just as the unemployment rate begins to deflate might seem counterintuitive. But such is the nature of homelessness, which tends to lag behind other macroeconomic trends.
During 2009 and 2010, for example -- a period when unemployment grew by leaps and bounds, and foreclosure filings increased at record rates -- homelessness in America actually dropped by 1 percent.
But the economy has experienced only limited growth since then. Millions are still out of work, and millions more aren't earning enough to cover basic living expenses. More and more homeowners and renters are edging toward a desperate situation.
According to the National Alliance to End Homelessness report, while the national homeless rate fell by 1 percent, the number of people living "doubled up" -- that is, lodging with friends or family for economic reasons -- rose by 13 percent in roughly the same time period. The number of unemployed people climbed by 4 percent. And the number of people in poverty who spend at least half their income on rent climbed by 6 percent.
Such changes all suggest trouble down the line. Living doubled-up is often a step on the road to no home, according to the report. A person in a doubled-up living situation has a 1 in 12 chance of becoming homeless within a year.
Other economic circumstances are putting additional pressure on low-income Americans. Many people simply aren't paid enough to afford a place to live, while others may be looking for rental units that aren't available in a market wracked by foreclosures.
Average real income for the working poor -- those who hold jobs but still live below the poverty line -- was just $9,413 in 2010, according to the report. On that income, the report states, one-bedroom apartments are unaffordable virtually everywhere in the country.
Meanwhile, the foreclosure epidemic is likely steering would-be homeowners into rental properties instead, which makes the market more competitive for renters.
"There just aren't enough units for the number of people who need them," Roman told HuffPost. The lack of affordable housing, she said, is the nation's "other housing crisis."
This aspect of the housing problem is likely to grow more pronounced in 2012 and 2013, as the number of foreclosures is expected to swell. By the end of next year, the president of the Federal Reserve Bank of New York recently predicted, there could be as many as 5.6 million homes in foreclosure.
Making matters still worse is the impending end of the Homelessness Prevention and Rapid Re-Housing Program, a $1.5 billion federal initiative funded through the 2009 stimulus package that both Roman and her organization's report credit with keeping the national homeless rate from ballooning during the economic downturn.
According to Roman, HPRP, as the program is known, focuses on preventive efforts, offering aid to renters and homeowners at risk of losing their place of residence. The program provides rental assistance to low-income households, helps those relocating find a new place to live and mediates discussions between landlords and tenants.
"A billion and a half dollars is a lot of money in terms of homeless assistance," said Roman.
But the money is almost all gone. A spokesperson for the U.S. Department of Housing and Urban Development said that virtually all HPRP activity will have ceased by September of this year. And with the federal government contemplating massive spending cuts, the future of national homeless assistance looks cloudy.
In two weeks, HUD will conduct its annual point-in-time count, when volunteers in more than 3,000 locations across America try to conduct a one-night nationwide head count of homeless people.
The 2011 count produced a estimate of 636,017 homeless individuals, a figure that represented a 2.1 percent drop from the year before. Roman said that anecdotal evidence suggests the numbers are rising now.
"We're certainly hearing from some places that demand is going up in the shelter system," she said. "It's worrisome."