Part II in a series by Dylan Lewis, ecoWURD Senior Producer

This crisis of unaffordable housing did not start yesterday. It’s a build-up of deliberate and very racist housing policy, corrupt financial institutions and severe structural deficiencies over generations. Recently, on WURD, Charles Ellison hosted a special ecoWURD panel in conjunction with the Council of State Governments Eastern Regional Conference to discuss the problem of “Unaffordable Housing” and how we got here. Panelists included: NY state senator and chair of CSG East Council on Communities of Color, Kevin Parker; PA state senator Nikil Saval; Lauren Bealore, associate director of state & local policy at Prosperity Now; and Sabrina Bazile from the Black Homeownership Project at the Center for NYC Neighborhoods. Following the panel discussion, Ellison spoke with Ty Brown, deputy director of GALAEI, and Dr. G.S. Potter, housing advocate and senior editor of theBEnote

Here are some causes of unaffordable housing that panelists outlined in that discussion …

The State of the Economy
With inflation raising prices in every part of the country alongside sharp increases in interest rates, a recession feels like it’s right around the corner.

The economic context we live in makes affording not just a home but the requirements to maintain a home difficult. “In 2007, when we had the housing bubble crash, that was about mortgages. Now the foreclosure crisis is not just about mortgages; it’s actually less about mortgages and more about things like taxes. People can’t afford the utility costs,” said Sen. Parker. The rising utility costs are not just from the beginning of the pandemic. In December, PECO customers saw a 15.8 percent increase in their electric costs. After the most recent property assessments in Philadelphia stung residents, home values spiked by 31 percent, meaning that the taxes on those homes will increase substantially, potentially causing many to lose their homes.

Stagnant Wages
When prices rise and wages stay the same, it’s a given that housing will become more challenging to afford.

Ultimately, there must be a secondary conversation about raising the minimum wage to a living wage to allow people to keep up with the fluctuating economic landscape. “You’ve mentioned the crisis of stagnant wages. By so many different measures, people were earning more several decades ago in terms of what their wages were. More wages than they are right now in any state, let alone Pennsylvania, where the minimum wage has been stuck at $7.25 for over a decade at this point. So increasing the ability of people to organize and form unions to bargain collectively at every level is one of the ways that we start to raise the wage floor in addition to kind of blanket policies that raise them by flat,” said Sen. Saval. The MIT living wage calculator estimated that a living wage for a single adult without children in Philadelphia would be $17.87 and a poverty wage would be $6.19. Our current minimum wage is much closer to that of a poverty wage than a living wage. Again, there is an expectation that people can afford rent costs when they are not making the wages necessary to live.

Structural Barriers
Even if Philadelphia was in a situation where there was an excess of affordable housing, there are still structural barriers in place that prevent people from obtaining said housing.

These barriers include deposits, credit reports and more that serve almost as a way to filter out those with a lower income. “There are the structural rubrics that go into play that are also preventative measures as well like requiring three months security which is actually against the law. Also requiring that we measure credit reports, deposits and all these things that really disempower our community and, you know, bottleneck access for black and brown people in Philadelphia, the tri-state region, and also other low-income groups that are moving to Philadelphia,” said Brown. “The people that are moving to Philadelphia are not just affluent people. We also have a burgeoning immigrant population coming from places looking for opportunity and we can’t have housing development practices that are essentially kneecapping them when they come in the door and basically offering them nothing but austerity measures. […] So, really, the crisis here that we’re dealing with is not just housing affordability. It’s not just housing scarcity. It’s also a completely fundamental broken praxis of how we serve the community and how we protect each other,” he continued.

Discrimination
Philadelphia is one of the many places in this country where a history of redlining and housing discrimination still leaves its mark today.

The deep roots of segregation in our city pose another barrier to affordable housing. They have created a housing market essentially designed to serve wealthy white people and discriminate against low-income Black and brown people. “My position is that the discrimination and the structural issues of the housing market are tied to the housing market itself. So for us to build without discrimination or without displacement, we need to untangle ourselves from the racist classist discriminatory private market and work towards building a commodified structure in the system.” said Bazile.

Supply
Gentrification is becoming more and more prevalent in Philadelphia. Corporate landlords are buying properties with the promise of increasing the housing supply but then raising the rents in low-income areas and pushing out residents.

“The supply problem is simply that, a supply problem. We do actually need to be building more housing. For example, you want to accommodate people moving to the city; you want to accommodate growth in some way. Not doing it ahead of time means you will face a constriction at some point. But building new market-rate housing can send a market signal basically that raises rents in an existing area and has the risk of displacing people,” said Sen. Parker.

In the next part of our series “There is No Cost To Live,” we’ll explore how much of a problem gentrification is posing to communities and residents struggling to stay afloat and stay housed. Stay tuned for more at ecoWURD.com.