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California Department of
Housing and Community Development

Overpayment and Overcrowding

Analysis of housing characteristics includes an estimate of the number of households and lower-income households, by tenure (rental or ownership), paying more than 30 percent of their income on housing. The analysis must also identify the number of households, by tenure, in overcrowded housing situations. 

Contact

(916) 263-2911

Photo of low income housing

Identifying and evaluating existing housing needs are critical components of the housing element. The analysis will help local governments identify existing housing conditions that require addressing and households with housing cost burdens or unmet housing needs.

An adequate analysis of these characteristics should include a quantification of the total number of persons, households or units; a quantification and qualitative description of the need; and identification of potential solutions and resources to address the need. Where a serious unmet housing need is identified, program alternatives and responses should be provided.

Where available, information on tenure characteristics (owner versus renter) should be included. Tenure information is important because it affects the nature of housing problems encountered, as well as the types of programs or resources needed to address them.

Government Code

Government Code Section 65583(a) requires “…an analysis and documentation of household characteristics, including level of payment compared to ability to pay, housing characteristics, including overcrowding, and housing stock condition,” (Government Code 65583 (a)(2)).

Requisite Analysis

Overpaying

Housing is generally the greatest, single expense for California families. Current standards measure housing cost in relation to gross household income: households spending more than 30 percent of their income, including utilities, are generally considered to be overpaying or “cost burdened.” Severe overpaying occurs when households pay 50 percent or more of their gross income for housing.

The impact of high housing costs falls disproportionately on extremely low-, very low-, and low-income households, especially renters. While some higher-income households may choose to spend greater portions of their income for housing, the cost burden for lower-income households reflects choices limited by a lack of a sufficient supply of housing affordable to these households. In 2010, according to the American Housing Survey, 41 percent of California's 3.2 million low-income renter households paid more than half of their income on rent. According to data from the U.S. Department of Housing and Community Development collected between 2006 and 2010, of the state's 2.2 million very low-income renters, 55.9 percent paid more than half of their income for rent. Low-income households that overpay for housing frequently have insufficient money left for other critical essentials, including food and medicine. This is a significant hardship for too many families and seniors; but it also impacts local economies, because money that might otherwise be spent in local stores (generating sales-tax revenues for the community) are being spent on housing.
An adequate analysis should:

Data Sources

U.S. Census 2000 Summary File 3 (SF 3):

HUD’s Consolidated Housing Affordability Strategy

U.S. Census American Community Survey: B25106 Tenure by Housing Costs as a Percentage of Household Income in the Past 12 Months

Pre-approved data packages are now available from HCD or your regional council of government. For more information, please contact Megan Kirkeby, Housing Policy Senior Specialist, at megan.kirkeby@hcd.ca.gov.

Sample Tables

The following sample tables will help organize critical information. The information provided in the tables should be tailored to the jurisdiction and followed by appropriate analysis. (Note: Sample tables are not intended to substitute for addressing the analytical requirements of housing-element law.)

Housing Cost as a Percentage of Household Income
Owner-Occupied Units

Income Range

Total Households

% of Total Households 0-20% of Household Income 20-29% of Household Income 30-34+% of Household Income
$0-19,999          
$20,000-34,999          
$35,000-49,999          
$50,000 +          
Subtotal          
Renter-Occupied Units
$0-19,999          
$20,000-34,999          
$35,000-49,999          
$50,000 +          
Subtotal          
TOTAL          
Source: U.S. Census American Community Survey B25106. 

Note: Some households are not accounted for; therefore, figures may differ slightly for other U.S. Census estimates for total households.


Percentage of Low-Income Households Overpaying for Housing

Owner-Occupied Units
Households with incomes less than 80% area median income Paying 30% or more of household income Percent
     
Renter-Occupied Units
Households with incomes less than 80% area median income Paying 30% or more of household income Percent
     
Housing Problems for All Households

 

Total Renters

Total Owners Total Households
Household income <= 30% median family income      
% With any housing problems      
% Cost burden > 30%      
% Cost burden > 50%      
Household income > 30% to <= 50% median family income      
% With any housing problems      
% Cost burden > 30%      
Household income > 50% to <= 80% median family income      
% With any housing problems      
% Cost burden > 30%      

Source: HUD Comprehensive Housing Affordability Strategy (CHAS) Data - Data Query Tool

Overcrowding

The U.S. Census defines an overcrowded unit as one occupied by 1.01 persons or more per room (excluding bathrooms and kitchens). Units with more than 1.5 persons per room are considered severely overcrowded. Overcrowding increases health and safety concerns and stresses the condition of the housing stock and infrastructure. Overcrowding is strongly related to household size (particularly for large and very-large households) and the availability of suitably sized housing. Overcrowding impacts both owners and renters; however, renters are generally more significantly impacted. In 2000, renter households were three times more likely than owners to be overcrowded, regardless of household size.

While family size and tenure are critical determinants in overcrowding, household income also plays a strong role in the incidence of overcrowding. As a general rule, overcrowding levels tend to decrease as income rises, especially for renters (particularly for small and large families). The rate of overcrowding for very low-income households is generally nearly three times greater than households over 95 percent of the area median income. As with renters, owner households with higher incomes have lower rates of overcrowding.

An adequate analysis of overcrowding should:

Data Sources

U.S. Census American Community Survey,  Tenure by Occupants per Room (Table B25014)

Sample Table

The following sample tables will help organize critical information. The information provided in the tables should be tailored to the jurisdiction and followed by appropriate analysis. (Note: Sample tables are not intended to substitute for addressing the analytical requirements of housing-element law.)

Housing Condition Survey

Housing Type

Owner

Renter Total Overcrowded
Persons per room Households Percent Households Percent Households Percent
1.00 or fewer            
1.01 to 1.50            
1.51 or more            
TOTAL            
% Overcrowded by tenure            

Source: American Community Survey One-Year Estimates. Tenure by occupants per room.

Sample Analyses

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Overcrowding and overpaying data may also be available from your council of government.