A study of six Arizona counties by the Morrison Institute for Public Policy at Arizona State University found that low wages, housing shortages, and an increase in short-term rentals and vacation homes are limiting access to affordable housing. I’m here.
The study brings together surveys from Maricopa, Yuma, Cochise, Coconino, Yavapai, and Pima counties, including discussions with residents.
According to the Morrison Institute, the solution lies in diversifying the housing stock, regulating short-term rentals and increasing rental assistance.
The Institute found that a common theme across the state related to housing insecurity is that the low wages many renters earn, especially those of color, limit their access to housing. discovered.
For example, research shows that minimum-wage workers in Coconino County’s largest city, Flagstaff, have to work 90 hours a week to afford a one-bedroom apartment. The average wage for a Coconino County renter is just over $18.
High rent burdens make it difficult for many renters to transition to home ownership.
People face the burden of housing costs when they spend more than 30% of their household income on housing, including rent and mortgage costs. About one in three Arizona residents faces this challenge, according to 2021 Census Bureau estimates.
Research shows that while homeowners may incur costs, renters tend to allocate 30% or more of household income to their homes.
In each of the six counties, more than 40% of renters bear the cost. Homeowners’ housing contribution rates range from 20% in Maricopa and Cochise counties to 26% in Yavapai counties.
Intense Rental Competition in Northern Arizona
Coconino County is the second largest county in the United States by land size and has the worst cost burden for renters of the six counties surveyed. Half of Coconino’s rental households spend more than 30% of her income on housing.
Tenants — 39% of the county’s residents — are in fierce competition for the few homes available. For example, one resident who participated in the study’s focus group told the Institute that more than 30 of her people applied for units of interest within hours of the listing being posted.
Residents also said the availability of affordable housing has decreased as the number of short-term rentals has increased within the county.
From 2016 to 2020, the number of all-facility Airbnb rentals in Coconino County increased by more than 500%, according to AirDNA data cited by the Morrison Institute. In 2016, Airbnb had an average of 415 listings each month. By 2020, that number has surpassed 2,500.
Short-term rental housing has also increased in Yavapai County in recent years, with housing shortages worsening in cities such as Sedona, Verde Valley, Cottonwood, and Camp Verde. In 2016, Yavapai County had an average of 374 full Airbnb rentals per month, according to AirDNA data. By 2020, that number had grown to 2,171, he said.
A significant number of second homes are also reducing the available housing stock in the county.
Of the approximately 747,000 vacant homes in Arizona, about half are vacation homes. According to U.S. Census Bureau census data, some Arizona counties, including La Paz (75.2%), Coconino (73.3%), Yavapai (66.5%), Mojave (71.5%), and Navajo (71.8%), have second homes. has been shown to be much higher. ), Yuma (67.2%) and Pinal (61.3%).
Low Wages Cause Housing Insecurity
In all six counties surveyed by the Morrison Institute, wages are not keeping up with home prices. Focus group participants said their jobs didn’t pay them enough to afford good housing close to where they work.
For example, research shows that only about 26% of people who work in Sedona actually live in the city. Across the state, about 15% of her workers age 16 and older who aren’t telecommuting have at least a 45-minute commute, according to recent U.S. Census Bureau data.
“Rents have increased 40 to 60 percent in the last two years,” says Allison Cook Davis, research director at the Morrison Institute. “The economic impact is incredibly difficult for renters.”
A 2021 estimate by the National Low Income Housing Coalition found that workers would need to earn $24 an hour to buy a two-bedroom apartment at a fair market price in the Phoenix metropolitan area. rice field. According to the U.S. Department of Housing and Urban Development, fair market value is the price paid by 40% of a renter’s girlfriend in an area.
According to the US Department of Labor, many workers, including healthcare support, cleaning services and personal care services, are paid less than $24 an hour.
People of color pay more for housing
Statewide, whites are more likely to be homeowners than Latinos, blacks, and Native Americans, according to data cited by the Morrison Institute.
People of color are disproportionately affected by high housing costs because renters are more likely to cover the costs, the Institute’s study concludes.
“Homeownership inequalities perpetuate because households of color are more likely to be renters and have higher cost burdens,” the authors of the study wrote. , the inability to save a down payment, and rising house prices hinder entry into the housing market, perpetuating the cycle of racial disparity in home ownership.”
Wages for households of people of color are generally lower, creating further hurdles to housing equity, according to the Morrison Institute.
For example, the average home price in Coconino County these days is more than nine times the median income of a Black household, almost seven times the median income of a Native American household, and five times the median income of a Latino household. That’s it. The survey found that the average home price in the county was just over four times the median income of white households.
Potential solutions include rental assistance, short-term rental reform
Researchers at the Morrison Institute said they were surprised that the housing problem extended beyond urban areas.
“Whether it’s rural Cochise County or Phoenix, it’s the same,” said researcher Ashley Tziganuk. “It was difficult to hear people camping in the woods or living in their cars.”
Focus group participants who shared their experiences with Morrison Institute researchers noted that potential solutions to the housing affordability crisis included diversifying the housing stock, building more affordable housing, renting It said it would include increasing access to housing assistance for people.
The Pima County portion of the study suggests extending leases to, say, five years, saving both tenants and landlords sales costs and providing long-term financial security to lessees. increase.
Regulating short-term rentals would also help alleviate housing shortages, the institute reports. In 2016, Congress passed a law prohibiting local government regulation of short-term rentals. Congress last year began allowing communities to impose licenses and other requirements on these rental properties.
“Airbnb regulation can take many forms without a state ban,” Cook-Davis said. Ultimately, she said, if the scale tilted in favor of long-term renters, it would help balance the housing market.
A 2016 law will challenge short-term rental regulations that significantly support long-term rentals, such as limiting the number of short-term rentals an owner can operate, said interim executive director Joanna Kerr. Arizona Housing Federation.
After several COVID-19 aid programs, funding for housing programs is drying up, she said. She said she hopes access to rental assistance will improve when housing program funding returns.
Please contact the reporter at olakunle.falayi@gannett.com.
