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48 | TH E M R EP O RT O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T THE LATEST DATA Paying More for Living Worse The number of Americans chunking out a pretty penny to reside in shoddy housing is on the uptrend. T he number of Ameri- cans paying more to live in substandard condi- tions increased between 2013 and 2015, according to a new report released by the U.S. De- partment of Housing and Urban Development (HUD). In fact, in 2015, HUD found that 8.3 mil- lion very-low-income unassisted families paid more than half their monthly income for rent, lived in severely substandard housing, or both. The agency referred to such residents as "worst-case needs" residents. The rise in worst-case-needs residents follows a dip from the prior "Worst Case Needs" report, which studied patterns between 2011 and 2013. The latest number of worst-case needs households, according to HUD, is the second highest on record and signals a 66 percent increase since 2001. The South and West reported the most very-low-income rent - ers. Miami, Memphis, Dallas-Fort Worth, and Los Angeles reported between 49 and 61 percent of their poorest renters were paying more to live in worse conditions. These renters also had the highest prevalence of worst-case needs and the lowest likelihood of receiving housing assistance, HUD reported. But the number of households with worst-case needs divided fairly evenly across racial and ethnic groups. The prevalence of worst-case needs during 2015 was 47 percent for Hispanic renters, 45 per - cent for non-Hispanic white renters, 37 percent for non-Hispanic black renters, and 41 percent for others. While incomes rose between 2013 and 2015, rents also increased nearly as fast, HUD reported. But for the poorest renters, rent hikes outpaced income gains; and though the production of rental housing is strong, "the rapidly growing renter population is putting increasing pressure on the rental market, particularly on the inventory of affordable rental housing," HUD reported. HUD Secretary Ben Carson quickly advocated for "a more business-like approach" focused on reducing regulatory barriers that would allow private markets to produce more housing for more families. "Two years ago, our nation was still feeling the aftershocks of our housing recession with rents growing faster than many families' incomes," Carson said. "After years of trying to keep up with rising rents, it's time we take a more holistic look at how government at every level, working with the private market and others, can ease the pressure being felt by too many unassisted renters." Carson added that by pursuing housing finance reform, the Trump administration seeks to "unwind the federal government's role in the private mortgage market and ease the stress on rental markets." Underestimating Home Values Although disappointment continues to plague homeowners hoping for higher appraisals, the valuation chasm is narrowing. Q uicken Loans released its Home Price Per- ception Index (HPPI) for August, which showed a continued gap between ap - praisal values and homeowners' expectations, although the gap is growing increasingly smaller. According to the report, the Home Value Index (HVI) also rose 0.19 percent on a national scale in August, with a 2.64 percent increase year-over-year. However, home appraisals were 1.35 percent lower than what the average homeowner expected. In July, the difference in appraisal figures and homeowner expecta - tions was 1.55 percent. "One of the biggest lessons from the HPPI is highlight- ing how regionalized real estate is," said Bill Banfield, Quicken Loans EVP of Capital Markets. "Homeowners who have a bet - ter understanding of their local housing market can make more informed decisions about their home. After all, their house is not just where they live, but one of their bigger assets." In the West, homeowners showed a trend of underestimat - ing the value of their home by 3 percent, while in the Midwest and Northeast, homeowners overes- timated the value of their home by 3 percent. And, the report notes, while 3 percent may seem like a small amount, that could mean the difference of $11,000 in unknown equity, depending on the regional housing market. The Midwest and the West also experienced rising HVI numbers, at 0.16 percent and 1.34 percent, respectively. The South and East regions' HVI dropped a modest amount, at 0.52 percent and 0.58 percent. According to Banfield, this data is best viewed on an annual basis, rather than in monthly increments. "As the sun sets on the summer, some of the intense competition for housing also winds down," Banfield said. "It's important to focus on the annual numbers with the HVI. While there can be some monthly varia - tions in the data, especially as sea- sons start to change, the annual numbers show healthy growth across the country." "Homeowners who have a better understanding of their local housing market can make more informed decisions about their home. After all, their house is not just where they live, but one of their bigger assets."