According to economists from the Center for Budget and Policy Priorities (CBPP), the cost of living for American adults has risen sharply in recent months, due to rising rents and utility costs. To deal with the financial impact on US households, an expert has urged the Biden administration to make housing choice vouchers more widely available.
“Providing more housing vouchers could help many additional tenants cope with higher costs and retain their housing,” said Will Fischer, CBPP’s senior director for housing policy and research. a recent blog post.
The voucher program is an effective way to reduce homelessness and help low-income consumers pay housing costs, Fischer said. But due to lack of funding, federal housing assistance only reaches about a quarter of eligible households, according to CBPP Data.
Keep reading to learn more about CBPP’s proposal to offset rising housing costs. And if you’re looking for ways to cut spending in a time of record inflation, you might consider consolidating higher-interest debt into a fixed-rate personal loan. You can visit Credible to compare debt consolidation offers for free without impacting your credit score.
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The current inflation rate does not fully reflect rising rents
the Consumer Price Index (CPI) showed rents were rising 4.2% a year in February, but Fischer said that was because it was calculated using “an average of rents paid by tenants in a survey sample, that whether or not they have recently rented their accommodation”. According to Zillow’s Observed Rent Index (ZORI), rents for newly leased units have jumped 17% over the past year.
Monthly rent has climbed $274 over the past year to $1,883 in February, with rising rental prices nationwide attributed to tight housing supply, research by Zillow found. And some cities have reported even bigger rent increases.
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Rent isn’t the only household expense rising – consumer inflation hit a new 40-year high last month, with the price of home fuel and utilities rising 11% a year, reported the CBPP.
Energy costs have increased significantly for fuel oil (44%) and town gas (24%), on which many people depend for household heating and cooking. Additionally, the CBPP predicts that utility costs will continue to rise due to the Russian invasion of Ukraine.
Separately, credit card debt jumped in the fourth quarter of 2021, according to the New York Federal Reserve, signaling that many Americans are becoming addicted to high-interest credit card spending. Credit card consolidation is a way for consumers with outstanding debt to save money and lower their monthly payments. You can read more about this debt management strategy on Credible.
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An average household waits 2.5 years to receive housing vouchers
Federal housing vouchers provide cash assistance to help tenants pay their monthly payments. Recent funding legislation enacted by Congress will provide about 30,000 new housing bonds, according to CBPP estimates. But he said that was not enough to help all families in need.
And while housing vouchers can provide much-needed relief to some low-income households, they don’t necessarily provide immediate relief. Data analyzed by CBPP showed that eligible beneficiaries wait on average nearly two and a half years to receive their housing vouchers.
“Additional vouchers should be accompanied by measures to ease the pressure on housing costs by building more homes, but that won’t happen quickly enough to help people struggling to pay their rent and utility bills. right now,” Fischer said.
Fischer also urged policymakers to allocate more public funds to affordable housing and ease barriers to building multi-family housing. But even with these measures in place, it could take years to stabilize housing costs.
If you’re looking for short-term ways to reduce your expenses, you might consider taking out a personal loan to consolidate higher-interest debt payments. You can visit Credible to browse current personal loan rates and see offers that are right for you.
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