U.S. Secretary of Housing and Urban Development (HUD) [1] Julian Castro said America is in the midst of an “affordable housing crisis” at a gathering of civic leaders at the City Club of Chicago Monday, according to the Chicago Sun Times.
[2]HUD Secretary Julian Castro
At a time where more and more people are moving into cities, Castro said there are 7.7 million low-income households that pay more than half their incomes on rent, and don’t receive any government assistance.
“That’s roughly equal to the number of people living in Chicago, Los Angeles and Dallas combined,” Castro said. “We are talking about folks who are spending so much of their precious dollars just to keep a roof over their head that they can’t invest in their children’s education or begin to build up savings.”
According to Castro, there is a backlog of $26 billion in repairs at all of the nation’s public housing. Due to this disrepair, the U.S. is losing 10,000 public housing units each year.
“The cold, hard truth is that federal dollars are scarce and won’t be able to fully address these issues any time soon,” Castro said.
The Rental Assistance Demonstration [3] (RAD) was created to combat the backlog of deferred repairs. RAD allows public housing agencies to leverage public and private debt and equity in order to reinvest in the public housing stock. This initiative also helps housing authorities and owners of assisted housing convert properties to long-term Section 8 contracts which “allows them to better leverage private debt and equity to improve their properties,” according to Castro. Castro said HUD is constantly looking for “creative solutions” to help with this problem in public housing.