Magazine article Poverty & Race

The "Housing + Transportation Index" and Fair Housing

Magazine article Poverty & Race

The "Housing + Transportation Index" and Fair Housing

Article excerpt

With their comprehensive "Housing + Transportation Index," The Center for Neighborhood Technology (CNT) has developed a useful tool for estimating the combined cost of housing and transportation - the two largest shares of most family budgets - for homebuyers in 337 metro areas. The index can be used to move land use and development decisions away from sprawl, and to inform individual family choices by emphasizing the transportation costs associated with lower-priced exurban homes.

However, the index is inappropriate as a tool for siting new low-income family housing. To be fair, CNT has indicated that it intends the index to be consistent with fair housing goals, but without a strong fair housing overlay, the index has the potential to (once again) steer low-income families into more segregated, higherpoverty neighborhoods. Such a use of the index would reinforce separate and unequal development patterns that are the opposite of smart growth.

The H+ T Index does not reflect the true cost of housing location for lowincome families:

For purposes of siting new assistedhousing units for low-income families, we agree that it makes sense to look not just at the cost of the housing, but also the other costs and benefits associated with a proposed location. In order to expand choice and access to opportunity, policymakers should consider all costs- not just transportation-in making location decisions. In particular, the overall costs of living in higher-poverty vs. lower-poverty communities should be considered.

Direct costs: Groceries

Research has shown that families living in poor neighborhoods pay more for the same groceries than those living in wealthier communities, due to a lack of large chain grocery stores in low- income neighborhoods, which leaves small stores lacking the range of products or the large economies of scale that help drive down prices at chain stores. Groceries can constitute a large portion of a low-income family's household budget (one study suggests 17%). Thus, when calculating the cost of living in a particular neighborhood, ignoring increased food costs could lead to inaccurate assumptions about affordability.

Direct costs: Financial Services

Low-income residents living in disadvantaged neighborhoods pay more for basic financial services such as check-cashing, short-term loans, tax preparation and money transfers than higher-income households. A low-income family can spend thousands of dollars more in extra costs for these services, depending on the extent to which they use them and the types of services they use. These high-cost options are much more densely concentrated in disadvantaged neighborhoods, where prime lending institutions remain underrepresented. …

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