Last week, chief economist of Trulia, Jed Kolko suggested a correlation between political leaning of U.S cities and the availability of affordable housing. Kolko claimed that the affordable housing availability differs significantly between large cities in red conservative and blue liberal states, with blue states showing a significant lack of affordable housing.[1] With Election Day recently behind us, this issue is only more pressing as new officials take their seats in Congress.

Kolko deduced this correlation by categorizing the 100 largest cities as red or blue depending on their 2012 presidential vote. In 32 “red” cities, including Houston, Cincinnati, and Salt Lake City, Mitt Romney (R), got more votes than President Obama (D). In 40 light-blue markets, including St. Louis, Austin, and Buffalo, Obama beat Romney by less than 20 percent. And in 28 dark-blue markets, including Los Angeles, New York, and San Francisco, Obama’s margin exceeded 20 points. By comparing this data with the cities’ respective housing trends, Kolko and his team at Trulia found that housing issues were most severe in blue Democratic markets.

When comparing red and blue housing markets, there appears a significant difference in regards to affordability. Not one of the 10 reddest markets had a median asking price per square foot above $130 in Sept. 2014, unlike nine of the 10 bluest markets.

The chart below plots the median asking price and the per-square-foot and the 2012 presidential vote, and shows that most of the red cities had the lowest median asking prices, while most blue cities’ prices were around twice as much. Blue cities also showed lower homeownership and income inequality. Additionally, when looking at how much people pay as a percentage of their income, the theory holds up. In Los Angeles, San Francisco, and New York, people spend on average 47%, 40.7%, and 39.5% of their income on housing, which is well above the 30% affordable limit.[2] In red states such as Houston and Cincinnati, the current percentage of income spent on rent was below the 30% national average at 29% and 26% respectively.[3]

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Kolko left the reasoning behind the correlation between affordable housing availability and liberal political leaning open for interpretation. UCLA economist Matthew Kahn suggested that the housing dearth in Democratic cities is due other concerns that weigh into the Democratic platform. Liberal development restrictions such as historic preservation, environmental preservation, and height ceilings add up across a city, and affordability bears the cost of these restrictions.[4]

Perhaps the discrepancy in affordability arises strictly from population density in these blue cities, which Kolko did not consider in his findings. The “reddest” cities of Knoxville and Tulsa have populations of 558,696 and 391,906 respectively, while the “bluest” cities of San Francisco and New York City have populations of 837,442 and 8.4 million. The discrepancy in affordable housing availability could be more a result of the city’s population size, which in turn affects their tendency to vote democratic. Large cities are often heavily comprised of minority and young populations, two demographics with both a tendency to vote democrat and require affordable housing. Cities with greater population sizes exhibit higher demands for affordable housing, especially when their populations are largely minority and millennial.[5]

Whether the heart of affordable houses crises is a result of political leaning, demographic, or sheer population size, the need for affordable housing is real across U.S cities. More than 80 percent of American households with incomes below $15,000 paid more than 30 percent of income for housing, the national standard of affordability, and more than two-thirds paid over 50 percent. Only about 24 percent of the 19 million eligible households receive federal rental assistance, according to data collected by the Urban Institute, a nonpartisan think tank.[6]  Whatever the ultimate cause for the disparity, actions must be taken across all cities alike to make housing in our country more affordable.



[1] Kolko, Jed. “Blue Markets Face Bigger Housing Challenges Than Red Markets – Trulia Trends.” Trulia Trends. Web. 7 Nov. 2014. <http://www.trulia.com/trends/2014/10/blue-red-markets-housing-challenges/>.

[2]  Dewan, Shaila. “In Many Cities, Rent Is Rising Out of Reach of Middle Class.” The New York Times. The New York Times, 14 Apr. 2014. Web. 11 Nov. 2014. <http://www.nytimes.com/2014/04/15/business/more-renters-find-30-affordability-ratio-unattainable.html?_r=0>.

[3] “Where the Middle Class Spends 75 Percent of Its Income on Housing and Transport.”CityLab. Web. 11 Nov. 2014. <http://www.citylab.com/work/2012/11/cities-where-people-spend-75-percent-their-income-housng-and-transportation/4027/>.

[4] Thompson, Derek. “Why Middle-Class Americans Can’t Afford to Live in Liberal Cities.” The Atlantic. Atlantic Media Company, 29 Oct. 2014. Web. 7 Nov. 2014. <http://www.theatlantic.com/business/archive/2014/10/why-are-liberal-cities-so-unaffordable/382045/>.

[5]  Stone, Madeline. “San Francisco Is The Least Affordable Housing Market For Millennials, But They’re Still Moving There In Droves.” Business Insider. Business Insider, Inc, 4 Aug. 2014. Web. 11 Nov. 2014. <http://www.businessinsider.com/san-francisco-least-affordable-for-millennials-2014-8>.

[6] “America’s Housing Affordability Challenges.” Housing Affordability Challenges. Web. 7 Nov. 2014. <http://www.equitablehousing.org/affordable-housing-challenges.html>.

 

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