Board of Governors of the Federal Reserve System

Housing and Neighborhoods

Three-quarters of adults were satisfied with their neighborhood in 2017, and a similar share were
satisfied with their house or apartment. However, satisfaction was notably lower in low-income communities. As one example of strain, nearly half of renters requested a repair from their landlord, and 18 percent of renters had moderate or substantial difficulty getting their landlord to complete a repair. Three percent of renters experienced an eviction during the previous two years.

Living Arrangements

Living arrangements are important for family finances and well-being. Sixteen percent of adults were living alone in 2017, and over half were living in a household solely with their spouse or partner and/or children under age 18 (referred to as a nuclear family). The remaining one-third of adults have living arrangements with other people that extend beyond the traditional concept of a nuclear family. Twelve percent of adults live with their parents, 10 percent live with an adult child not in school, 10 percent live with extended family members, and 5 percent live with roommates (table 23).

Table 23. People living in household

Over a quarter of young adults ages 25 to 29, and slightly more than 1 in 10 in their 30s, live with their parents (table 24). Hispanics in their late 20s are more likely to live with their parents (45 percent) than similarly aged blacks (27 percent) or whites (21 percent). A substantial majority of people living with their parents say that saving money is a reason for the living arrangement. As people age, however, the financial relationship flips for some families. Over two-fifths of young adults in their late 20s provide financial assistance to their parents; twice that seen among those in their early 20s. Moreover, nearly one-third choose this living arrangement at least in part to care for sick or elderly relatives.

Table 24. Reasons for living with parents among young adults (by age)

Housing

For housing, 66 percent of adults own a home, 25 percent rent, and 8 percent have some other arrangement. Renters, on average, are younger and have lower incomes than homeowners. Among those with family incomes under $40,000, less than half of people own their home (table 25).

Table 25. Housing tenure (by age and family income)

The median monthly rent is between $750 and $1,000, and among low-income renters whose income is below $40,000 per year, the median monthly rent is between $500 and $750. Seven in 10 low-income renters spend more than 30 percent of their monthly income on rent, which is the standard for housing affordability used by the Department of Housing and Urban Development.³³

One way to assess rental quality is whether the landlord makes repairs promptly.³⁴ Nearly half of renters requested at least one repair, such as a leak or a broken appliance, during the year prior to the survey, and one-fourth experienced at least some difficulty working with their landlord to get the repair done. Just under one-fifth of all renters (or 39 percent of those who requested a repair) experienced moderate or substantial difficulty. The share reporting any difficulty with repairs is basically unchanged from 2016, although more now report moderate or substantial challenges.

Among renters requesting a repair from their landlord, white renters are more likely to say that those repairs were completed without difficulty. Slightly over half of whites requesting a repair had no problems getting it completed, compared to 35 percent of black renters and 43 percent of Hispanicrenters who requested a repair. This gap largely reflects more black and Hispanic renters having a little difficulty, rather than more serious difficulties (figure 19).

Eviction is a less common, but more acute, sign of strain among renters and among those who previously rented but now rely on others for housing. Three percent of all non-homeowners were evicted or moved because of the threat of eviction in the past two years--which represents 9 percent of all non-homeowners who moved from another rental unit over this time. This frequency of eviction is unchanged from the 2015 to 2016 period. These evictions are somewhat more common in urban than rural areas, contributing to 9 percent of recent moves in urban areas versus 6 percent in rural areas.

Neighborhoods

Where to live and whether to buy a home are influenced by several factors, including where someone grew up, neighborhood amenities, and housing costs. Reflecting low rates of geographic mobility, nearly half of adults live within 10 miles of where they went to high school (see box 3 for a discussion of geographic mobility). But most people are generally happy with where they live. Overall, three-fourths of people are satisfied (either somewhat or very) with the quality of their neighborhood, and a similarly high share are satisfied with the quality of their home or apartment. Most are also satisfied with specific aspects of their neighborhood--including local schools, safety, and other amenities (figure 20).

The rate of overall neighborhood satisfaction is slightly higher among urban residents (76 percent) than rural residents (72 percent). Additionally, adults living in low- and moderate-income neighborhoods are much less likely to be satisfied with their neighborhood (60 percent) than those in middle- and upper-income communities (81 percent).³⁵ Satisfaction with specific amenities, such as the quality of local schools, also varies with neighborhood income (figure 21).

Neighborhood satisfaction is also lower among blacks and Hispanics than among whites, due in part to differences in their own incomes and those of their neighborhoods. Eight in 10 whites are satisfied with their neighborhood, compared to two-thirds of blacks and Hispanics who are satisfied. The racial/ethnic gaps in neighborhood satisfaction extend to specific amenities, including local schools and safety (table 26).

Table 26. Satisfied with local neighborhood and housing characteristics (by race/ethnicity)

In evaluating the desirability of neighborhoods, people focus on different amenities that are most important to their lifestyle. The importance of some specific amenities varies by age. People of all ages think that it is at least moderately important to have a grocery store in their neighborhood and to have shops or restaurants nearby. However, while a local bank or credit union is important to those of all ages, it is less important to younger age cohorts than it is to those over age 60. Similarly, older age groups consider it more important to have a church or place of worship nearby. Conversely, younger adults--and especially those ages 30 to 39--place a higher premium on local parks and playgrounds than do older individuals (table 27).

Table 27. Neighborhood amenities that are moderately or very important (by age)

The importance of neighborhood amenities also differs across urban and rural environments. Rural residents place a greater importance on a local church or place of worship than urban residents, but are less likely than urban residents to cite each of the other amenities considered as important to their location decision (figure 22).

 

References

 

 33. Rent-to-income ratios are calculated based on the midpoints of the ranged income and rent responses. Renters who report no income are excluded. Alternatively, when including those reporting no income, 73 percent of low-income renters have rent burdens over this threshold. See Jeff Larrimore and Jenny Schuetz, "Assessing the Severity of Rent Burden on Low-Income Families," Finance and Economics Discussion Series Notes (Washington: Board of Governors of the Federal Reserve System, December 22, 2017) for a discussion of rent burdens among low-income families. Return to text

 34. Matthew Desmond, Evicted: Poverty and Profit in the American City (New York: Crown, 2016) highlights the challenges of rental housing repairs among low-income renters. Return to text

 35. Low- and moderate-income neighborhoods are census tracts with median family income less than 80 percent of the national median income. Middle- and upper-income neighborhoods are those with family median income above the threshold. Neighborhood designations are calculated with the five-year averages from the 2012-16 American Community Survey. An alternate definition of low- and moderate-income neighborhoods based on average incomes relative to the surrounding area, rather than relative to national averages, produces similar results. Return to text