UC Irvine

One of the most common approaches to addressing the pervasive housing affordability crisis throughout the U.S. has been to change laws and land use regulations in order to induce increased housing production. Increased production is meant to induce the “filtering” process whereby existing housing units “filter down” to lower income households over time, becoming Naturally Occurring Affordable Housing (NOAH). Some remain skeptical that this process delivers beneficial outcomes to low-income and Black, Indigenous, and People of Color (BIPOC) households in particular. Using a longitudinal panel of housing units from the American Housing Survey (AHS) from 2015 to 2023 along with two measures of affordability, I analyze how affordability amongst market-rate housing units in the U.S. shifts over time and how geographic, housing supply, housing cost trends, and household characteristics relate to filtering dynamics in the U.S. I find that filtering slows amongst units 50 years and older, poorer quality units are more likely to filter downward, and rental units that have been rehabilitated are more likely to filter upward. I also find that owner-occupied units are more sensitive to changes in housing supply while rental units respond more to changes in housing costs. Gentrification’s impacts to affordability are mixed, depending on the affordability measure used, though there is distinct variation in outcomes between neighborhoods that are affluent, low-income, and low-income areas experiencing change. I also find that Black and Hispanic/Latino households face barriers in gaining access to NOAH compared to other households. Lastly, I find that, depending on the measure used, units identified as affordable may obfuscate the fact that many of their occupants have high housing cost burdens. These outcomes paint a complicated picture—while increased supply does seem to have important implications for housing affordability, downward filtering has generally slowed in the last decade and there is evidence that low-income, BIPOC households have barriers to accessing NOAH in particular.