A rising tide lifts all homes? Housing consumption trends for low-income households since the 1980s

Abstract

This study analyzes patterns of housing consumption and expenditures among low-income households since 1985. For households in the bottom income quintile, real monthly housing expenditures have risen from $605 to $1,045. However, these increased expenditures partially reflect housing quantity improvements, including more square footage, more rooms, and larger lot sizes. The data also show a marked improvement in housing quality, such as fewer sagging roofs, broken appliances, rodents, and peeling paint. The housing quality for low-income households improved across all 35 indicators we can measure. These quality improvements equate to between a 34 to 43 percent increase in housing consumption and suggest that a typical low-income household in 2021 experiences housing quality equivalent to the average national household in 1985. Though relative housing consumption has remained similar, this “rising tide” of housing may have additional benefits for the well-being of families and children living in better housing.