Opinion: Why 'affordable' is about more than housing units in the Upstate

The lack of affordable housing continues to dominate conversations. And the idea that simply building more homes will completely solve the crisis isn’t reasonable, given rising costs of land, labor and materials.

In addition, the continued growth of low-paying employment opportunities in the Upstate exacerbates cost-burdened households. 

There are two sides to this equation: the number of affordable units, and adequate household income. Most local policymakers have been focused solely on the unit count.

As the incoming CEO and current CEO of two leading Greenville non-profit organizations serving the entire state, Community Works and Homes of Hope, we thought it would be good to come together to comment publicly on this. We share an opinion and a mutual problem, that if solved or improved, would greatly contribute to an affordable-housing solution without building a single structure.

A math equation might be the answer

First, the idea must be presented that "affordable housing" shouldn’t be considered a type or style of house, or a measurement of housing quality, or housing that is segregated by income. Affordable housing should be a math equation.

Take your income and determine what 30% of it would be. If you pay that 30% or less for your housing, congratulations! You live in affordable housing.

Now, think about a lower-income family living here in Greenville, which is paying 50% of its income for housing. Every month this family struggles with the threat of eviction or foreclosure if catastrophe hits, like being laid off, or becoming ill and not being able to work.

The fact is that many individuals working in Greenville do not earn a “living wage” (which ranges from $9.48 -$18.62 per hour, depending on household size and the ability to afford a standard apartment).

In many cases, individuals earn below $10 an hour, a wage that would be a barrier for most households in Greenville to affording even the most affordable housing unit. The National Housing Conference’s Paycheck to Paycheck study indicates a household would need to earn $60,000 a year to purchase a home and about $33,000 a year to rent a two-bedroom apartment in the Greenville metro area. Much of our critical workforce in hospitality, manufacturing and warehousing earns $10,000 or more less than what would be required.

Due to these low-paying jobs, many households are “cost-burdened” not only to pay for housing, but also for daily living expenses. One unexpected circumstance or an emergency could claim these working households as homeless. They are one paycheck or car breakdown or loss of day care services, or health incident away from being unable to afford even the most affordable house.

And in these extreme circumstances, households are apt to tap into payday or predatory-type loans that end up putting them further and further behind.

Payday loans are high-cost, unsecured, small-dollar loans that can trap borrowers in debt. They are allowed in South Carolina under state law.

Unfortunately, South Carolina is still one of the largest payday lending states in the country. There are more than 900 payday lending locations across the United States.

These short-term, small-dollar loans that many of our lowest income households’ access to help them through unexpected issues or emergencies can cost more than 300% interest, spiraling borrowers into an ongoing debt cycle. This not only impacts their credit; in some cases, it also puts liens and tax burdens on their properties.

So solutions to the affordable housing crisis must go beyond preserving and building affordable housing units. We must look at both sides of the equation.

Prosperity Now’s recent scorecard for Greenville indicates that more than 10% of the population lives in poverty, 22.7% of homeowners and 46.2% of renters are cost-burdened, and more than 19% of households are unbanked or underbanked.

The housing crisis solution is more than just increasing the number of housing units preserved or produced. It is also about looking at ways to increase household incomes, through workforce development opportunities that create quality jobs, working with area employers to support living wage opportunities for the workforce, and increasing financial education to help households better evaluate the types of credit they obtain.