High housing costs in Massachusetts place significant financial pressure on the state’s residents, whether they are homeowners or renters, families or individuals. A lack of affordable housing has the potential to negatively impact the state’s economy by decreasing the region’s competitiveness. While many households in the state experience affordability problems, how to best allocate federal and state dollars to address this issue depends on the population those funds are meant to serve. The lower a household’s income, the more it depends on financial assistance to find housing that is affordable and to cover monthly rent payments.

This is particularly true for Massachusetts’s extremely low-income (ELI) renter households, defined as those with incomes at or less than 30 percent of the area median income (AMI). In 2016, 79 percent of these households were “rent-burdened,” spending more than one-third of their household income on rent and utilities. Due to high housing costs, ELI households often have to forgo spending on healthcare, food, childcare, or other necessities. A single financial shock a job loss or a large medical bill can cause this group to fall behind on rent, leading to eviction or even homelessness. Massachusetts has a large shortage of affordable and available (AA) housing units for ELI renter households and this problem could be exacerbated if action is not taken to address the growing number of affordable housing units whose subsidies are at risk of expiring in the coming years.