Who can afford housing in Los Angeles?

Who Can Afford Housing in Los Angeles?

Current House Price in LA?

Home prices in Los Angeles skyrocketed last decade, reaching the median value of $593,500 in the year of 2016, which is 25% higher than the median home price in California ($477,500) (U.S. Census, 2016). 

What about Rent Price?

Not only the home price, but rental price is also higher than state’s median price, marking $1,350 for a one-bedroom apartment and $1,740 for multiple bedrooms (U.S. Census, 2016). 

However, while median rent in Los Angeles County has increased 32% since 2000, renter’s household income has decreased 3% (California Housing Partnership, 2017). When we think about median household income in Los Angeles at $54,432, which is about $10,000 less than California’s median income, it suggests that households earning median income barely afford their housing cost every month based on the 30% rule of thumb regarding the housing cost-to-income ratio (U.S. Census, 2016; California Housing Partnership, 2017).



Who is affected?


Living in decent, affordable, and reasonable housing is one of the first important basic
needs of all people. Housing affects people’s lives, as it can determine their access to work, education, and recreation. However, unfortunately, housing in Los Angeles is extremely expensive and many households are burdened by rising housing costs. Those families who are experiencing housing cost burden, allocating more than 30% of their income to housing, often forced to spend much less income left on other basic needs such as food, transportation, and healthcare. 


Researchers have found that there is the association between housing cost burden and overall health of people. Currently, many federal housing subsidies programs are focused on low-income families – whether the gross household income is under the federally identified income level – but it does not consider the living costs in different cities. Based on this measure, Los Angeles’ poverty rate is 18%, but when the cost of housing in Los Angeles is considered as a factor into the poverty measure, the rate goes up to 26% (California Housing Partnership, 2017), almost one third of households in Los Angeles are living in poverty. Even if it would take time and cost to help people in Los Angeles afford the decent housing, policymakers should come up with effective policies to help reduce housing crisis in a near future.

Am I affected by it?



Of course YES!
When it comes to housing cost in Los Angeles, it is not just problem of low-income families, but middle-income and working-classes' problem too. So the rule of thumb is that people should not spend more than 30 % of their income on housing. But finding a decent apartment in Los Angeles meeting such a standard is nearly impossible. I am living in Koreatown, Los Angeles, and currently allocating more than 30% of household income to housing. If you are left with less money in your pocket, it is obvious that you will have to cut other expenses. It affects the choice you made over where you shop for grocery (Whole Food Market versus corner grocery shop), lunch menu you choose ($9 white meat chicken salad versus dollar menu from Mcdonalds'), whether to buy health insurance or go uninsured ($250 monthly premium versus $0 and uninsured), and the list goes on. 


It is very hard to get people understand that the housing cost crisis is not for the poor. Raising the cost of housing in Los Angeles will soon make it harder for people to stay in the middle class. As many of Angelinos are thinking about move out of the expensive city, I am also hoping to move to another state in search of more affordable housing.  

Through this project, I talked to few people who felt the same way about rising cost of housing in Los Angeles and commented about this issue.

Kevin (Los Angeles)

"Rising cost of housing affects me significantly. I started to limit myself to a leisure, foods I eat, places I go, and social life. And after all, I will end up with no money in my savings account." 

Jasmin (Los Angeles)

"I wanted to move out of my parents' apartment from a few years ago, but it is hard to afford a single apartment room for $1,800 by myself. Like many others, I have a car payment, car insurance, phone bill, internet bill, and grocery to pay on top of rent. I see many friends and families around me leaving Los Angeles to Las Vegas, not for better jobs or pay, but because housing price is so much cheaper.

Iris (Los Angeles)

"Living with roommates, sharing kitchen and bathroom, is sometimes inconvenient experiences. But what can I do? By sharing a house with roommates, I have about $500 to $700 more to spend on other basic necessities than renting an apartment in Los Angeles. So I have to bear with inconveniences. 

References

California Housing Partnership (2017). Los Angeles County Renters in Crisis: A Call for

Action. Retrieved from http://1p08d91kd0c03rlxhmhtydpr.wpengine.netdnacdn.com/wp-content/uploads/2017/05/Los-Angeles- County-2017.pdf

U.S. Census Bureau (2016). American Community Survey 1-year estimates. Retrieved from

Census Reporter Profile page for Los Angeles CA https://censusreporter.org/profiles/16000US0644000-los- angeles-ca/