Post-Recession Housing Market Makes a Recovery
Mortgages Rebound Slightly, but Cost of Housing Remains a Burden
NEWBURGH – November 23, 2015 – When Hudson Valley residents sit down for a Thanksgiving dinner this week, there’s a good chance it will be at a table in a home the family technically cannot afford.
The annual housing report released today by Hudson Valley Pattern for Progress says while some indicators, including the number of conventional mortgages, have rebounded somewhat since the Great Recession, the cost of housing in the Hudson Valley remains a problem throughout the region. The 32-page report, “Housing in the Hudson Valley: Post-Recession Housing Market Makes a Modest Recovery,” notes that large percentages of renters and homeowners at all income levels in each county are paying too high a share of their income on housing.
More than one-third of renters and homeowners in Dutchess, Greene, Orange, Putnam, Rockland, Sullivan, Ulster and Westchester counties have a housing cost burden that is considered unaffordable or, worse, a severe burden. According to the U.S. Department of Housing and Urban Development (HUD), when a household pays more than 30% of gross household monthly income for housing, it’s unaffordable; households paying more than 50% are said to be severely cost burdened by housing.
“While stagnant wages certainly play a part in determining what is out of reach, our analysis shows that housing costs, including property taxes, remain a significant challenge and a growing concern for the economic health of the Hudson Valley,” said Michael Welti, vice president for urban and regional planning at Pattern and principal author of the report.
The report also takes a closer look at housing in six urban centers in the Hudson Valley –Beacon, Brewster, Kingston, Peekskill, Poughkeepsie and Newburgh. The six places display a wide disparity in the cost of houses but tell a similar story in that buying a home – or renting one – is largely unaffordable given what people are earning. The report’s analysis reveals that 90% or more of the homes for sale in these communities are unaffordable for a household earning the median income.
“In addition to causing financial and emotional stress, high housing costs can leave households with limited dollars for other necessities such as food, clothing, healthcare, and transportation,” Welti said. “The financial squeeze also restricts discretionary spending and impacts local and regional economies.”
The report was released through the Center for Housing Solutions and Urban Initiatives at Pattern for Progress. While shedding light on the region’s housing challenges, the report also examines possible ways to address the issues including the use of flexible inclusionary zoning (IZ). In addition, the report discusses some of the successful approaches to providing more affordable housing being tried in Newburgh by Habitat for Humanity and the Newburgh Community Land Bank.
“It is critically important for local governments and zoning, planning and school boards to work in partnership with developers looking to meet the needs of the communities for both affordable and market rate housing,” said Joe Czajka, executive director of the Center for Housing Solutions. “The development of a diverse range of new homes and preservation of existing homes is a vital element of economic development and a fundamental component in the attraction and retention of millennials. Especially with our declining school enrollment, establishing policy and streamlining approval processes for housing is essential to the growth of the Hudson Valley.”