Rapidly growing American cities are losing affordable housing at an alarming rate, according to a study released Wednesday by Freddie Mac, a government-sponsored entity that buys mortgages and packages and resells them as mortgage-backed securities.

The percentage of multi-family rental units affordable to households making 50 percent of the area median income in any given metro fell from 55.7 percent to 39.1 percent from 2010 to 2017, according to the report. During that same period, 85.9 percent of metros saw a loss of affordable units.

“Cities that have experienced aggressive population growth have struggled to build enough rental housing to meet the increased demand,” said Steve Guggenmos, a co-author of the report who leads Freddie Mac multifamily’s research and modeling team.

“The problem continues to get worse, and every year more very low-income families are forced to spend more of their income on housing,” Guggenmos added. “That’s especially true where population growth is rapid. The old laws of supply and demand are showing their teeth and the people who can least afford it are getting bit.”

The report looks at multifamily rental affordability and unit-level rent data published by the American Community Survey. Researchers compared that data to population data and found a strong correlation between population growth and affordability loss.

“If these two variables were in fact not related, the chance of observing a result this extreme is about one in seven million,” Guggenmos said. “The data show that population growth is strongly correlated with affordability loss.”

Specifically, in Austin, Texas, researchers found that the population grew by 22.5 percent over the time period they studied and nearly a quarter of Austin’s new units were built after 2009. In 2010, 66 percent of multifamily units in the Austin Metro area were affordable to very low-income houses. By 2017, that number dropped to 31.9 percent, seven points lower than the national average.

In Raleigh, North Carolina, as the population grew by 17.4 percent from 2010 to 2017, the number of units affordable to low income-households fell 40.1 percentage points. In contrast, in a city like Pittsburgh that saw a 1 percent decrease in population, the number of affordable units only fell 5.8 percent.

The report concludes that one of the driving costs behind shrinking affordability is that rent growth has outpaced income growth.

Email Patrick Kearns

How do you stay ahead in a changing market? Inman Connect Las Vegas — featuring 250+ experts from across the industry sharing insight and tactics to navigate threat and seize opportunity in tomorrow’s real estate market. Join more than 4,000 top producers, brokers and industry leaders to network and discover what’s next, July 23-26 at the Aria Resort. Hurry! Tickets are going fast, register today!

Thinking of bringing your team? There are special onsite perks and discounts when you buy tickets together. Contact us to find out more.

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription
×