Overcoming intergenerational poverty,
which has barriers well beyond housing
affordability, is difficult anywhere in the
United States, but recent research suggests
that it may be even more challenging to
overcome these barriers in Indianapolis
relative to other large cities.
Housing affordability is embedded within the broader economy.
Harvard University’s Equality of Opportunity
Project released a study that examined the
likelihood of someone raised in the bottom
20 percent of an area’s income distribution
moving to the top 20 percent within their
lifetime. Indianapolis ranked 46th among
the 50 largest cities in that measure, where
only 4.9 percent of residents could expect
to make that move (relative to 12.9 percent
in San Jose, CA). 13
While this reality points to challenges well
beyond housing, it is worth recognizing
that housing affordability plays a role in an
individual’s likelihood of experiencing
upward mobility within their lifetime.
Policy Options
The federal government does not currently
have a broad, goal-oriented policy for
housing and neighborhood development.
Federal programs that are meant to
improve opportunities for individuals and
families may work at cross purposes with
those intended to support the physical
revitalization of neighborhoods; in some
cases, these conflicts arise within the same
federal program.
While the lack of federal focus on cities
generally and housing and community
development specifically can cause
challenges, it provides relatively wide
latitude for local communities to develop
and pursue locally defined policy goals.
13
This is especially true in places that receive
their own federal allocation of community
development resources.
Housing affordability is embedded within
the broader economy. We often look at the
cost side of the homeownership equation
without paying as much attention to the
resources side.
If 30 percent of a household’s income is the
threshold at which housing becomes
affordable, housing can be made affordable
by reducing the cost of housing or through
raising people’s income, and the latter
approach is too often ignored in the
context of housing affordability.
Summary and other research available at
http://www.equality-of-opportunity.org/index.php/component/content/article?id=82