Families who pay more than 30 percent of their income for housing are considered cost burdened and may have difficulty affording necessities such as food, clothing, transportation and medical care. An estimated 12 million renter and homeowner households now pay more than 50 percent of their annual incomes for housing. A family with one full-time worker earning the minimum wage cannot afford the local fair-market rent for a two-bedroom apartment anywhere in the United States.
Each year, the Department of Housing and Urban Development (HUD), Department of Agriculture (USDA), and the Internal Revenue Service (IRS) spend around $40 billion on housing programs, serving households with lower incomes (80 percent or less of the applicable area median income) as well as populations with special needs, such as - the elderly and persons with disabilities.
However, not all eligible low-income households receive federal rental assistance. According to the most recent available HUD data, in 2009, of the 17.12 million very low-income renters susceptible to severe rent burdens and severely inadequate housing, 7.10 million (41.5 percent) faced one or both of those problems without housing assistance.
Affordable housing, however, is not just a problem for the very poor who are forced into homeless shelters; affordable housing is also a problem for middle (and even upper middle) class people who are forced into suburbia by skyrocketing housing costs. Government subsidies are unlikely to solve this the latter problem, because in an already highly-taxed society, the public would probably not tolerate the level of taxation required to make housing affordable for the majority of the population.
A better remedy is to allow more private sector housing construction. If a community's overall housing supply sufficiently increased to satisfy local demand, rents would eventually go down or at least stop rising; and the community would be more affordable for the middle class, just like rural communities throughout the United States.
But even if America's rents declined significantly, there would still be homeless people. In fact: every major American city has hundreds, if not thousands, of homeless people for the simple reason that even cheaper-than-average rents are be too expensive for people who are utterly destitute and/or incapable of taking care of themselves. These people will need public housing or significant government subsidies to be housed.
The issue of "affordable housing" is two separate and very different problems â€” a) housing for the middle class, and b) housing for the poor. Insomuchas Republicans and Democrats insist on talking past each other to solve nothing, America needs a new political party - a Socialist Party, that will address the Affordable Housing issue as two distinct issues.