Across the United States home values have been on the rise since 2012, after recovering from the 2008 financial crisis. Between 2012 and 2018 average median home values increased 39 percent, not adjusted for inflation. During that same time period the states’ average homeless populations declined steadily until 2017. Nevertheless, between 2012 and 2018 homelessness declined by 11.3 percent.
You might think that if home values are increasing, homelessness should be increasing as well. Based on national trends, that is not the case. Actually, decreasing homelessness correlates with increasing median home values. But, once you look at individual cities you can see that each has their own unique story.
Of the 75 largest U.S. cities, the city with the largest jump in median home value from 2018 to 2019 was Detroit with a 12.85 percent increase. Detroit also saw an increase in homelessness with an 11.08 percent jump from 2018 to 2019, but the homeless population in the city has decreased by 46.8 percent since 2009.
In 2018, the Executive Director of Detroit Homeless Action Network credited the city’s declining homeless population to having a “housing first” approach. Even though Detroit has made progress with their homeless population they believe there is still work to be done, and so does the federal government. In January 2020, the U.S. Department of Housing and Urban Development announced that Michigan will receive $73 million in grants to fight homelessness, with $25 million of that going to Detroit.
Over the past few years the city of Charlotte has been putting more money into affordable housing, with the help of local nonprofit and corporate organizations. In the fall of 2018, the city of Charlotte put $50 million into the Housing Trust Fund, and a private sector fund has also raised $50 million for affordable housing.
The majority of California cities were outliers in this correlation. Twelve California cities included in this data saw an increase in both homelessness and median home values in 2018.
The debate on how to handle the growth of homelessness in California has been on going between state and local government officials. Governor Gavin Newsom has proposed a $750 million program to fight homelessness that would go towards rent vouchers, legal support, and mediation services. California’s state government believes that to fix the problem different regions of the state need different solutions, but they have yet to specify how the regions will be divided.
Stockton, CA, for example, had the largest jump in homelessness with a 56.14 percent increase from 2018 to 2019. Stockton also had a slight increase in median home value with a 4.34 percent jump in 2019, but the city’s median home value has been on the rise since 2009.
Stockton residents are facing the same issue many in the state of California are facing: they cannot find affordable housing. San Joaquin County and the Stockton/San Joaquin Continuum of Care will both receive $3 million of the state’s Homeless Housing, Assistance and Prevention Program’s $650 million fund.
Of the largest 75 cities, San Jose saw the largest decline in median home value from 2018 to 2019 with a 6.57 percent decrease. The city also saw a 33.80 percent increase in homelessness. San Jose, however, was the only city out of the nation’s largest cities to have a decrease in median home values and an increase in homelessness.
San Jose is attempting to address the city’s recent growth in homelessness through Measure E. Measure E is an attempt to provide affordable housing and add more services to help the city’s homeless population through a tax on sales of properties worth more than $2 million. This measure will be up for vote on March 3, 2020.
With the exception of a few California cities, the trends all indicate a correlation between decreasing homelessness and rising median home values between 2010 and 2018. The question is whether this is the beginning of a new trend. Will home values continue to rise while homelessness decreases? San Jose suggests otherwise.