Shelter Poverty

The Logic of Affordability

Housing affordability is, most fundamentally, an expression of the social and material experiences of people, constituted as households, in relation to their individual housing situations. Affordability expresses the challenge each household faces in balancing the cost of its actual or potential housing on the one hand and its nonhousing expenditures on the other, within the constraints of its income.

But why give primacy to housing? What about the affordability of health care, food, and other necessities? Because of housing's distinctive physical attributes—bulky, durable, tied to land—its cost [Page 671]is the largest and least flexible expenditure in most families’ budgets. This cost usually makes the first claim on a household's disposable income, with other expenditures being adjusted to fit whatever income is left over. That is, it is not income alone but income in relation to the cost of housing that is decisive in determining a household's standard of living.

How, though, can it be determined whether a household has an affordability problem? Some argue that it is purely subjective. From this perspective, housing affordability per se has no generalizable meaning; it is neither rationally possible nor socially desirable to establish a normative standard of affordability other than individual choice.

Public policy and interpretation of individual experiences are mediated through analytical indicators and normative standards of affordability that transcend individual experience. Such indicators and standards make it possible to arrive at conclusions about the overall extent of affordability problems and needs and their distribution socially and geographically. They also provide an important foundation for the rational formulation, implementation, and evaluation of policies and practices—by governments, housing providers, and mortgage lenders—that deal with affordability.

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