Introduction

Housing and community development statistics have many interrelationships with other functional areas, notably with demographic, construction, finance, and price statistics. While it is not possible to discuss housing without reference to such other areas, attention in this chapter will be concentrated on addressing those aspects which have peculiar significance for housing.

Responsible Agencies and Core Programs

Collection Agencies

Housing inventory comprises a large component of the Nation's physical wealth. The Housing Division of the Bureau of the Census oversees the collection of the most important body of data regarding this vital national resource. The major programs administered by the Housing Division are the housing portion of the Decennial Census of Population including a follow-on Survey of Residential Finance and a separate sample of the components of inventory change, the Annual Housing Survey, the Quarterly Housing Vacancy Survey, and the Quarterly Survey of the Market Absorption of New Apartments.

The most basic of the data programs are the censuses of population and housing which provide detailed data on salient characteristics of housing and its occupants for all localities in the Nation. The periodic census data are supplemented on a current basis by the Annual Housing Survey (AHS) which provides updates primarily on a national basis. The AHS is structured so as to show the components of inventory change (e.g., additions, losses, and mergers) as well as the changes in the characteristics of households occupying a panel of the same housing units over time. The AHS includes 3 rotating panels of 20 metropolitan areas each year for a total of 60 areas over a 3-year cycle.

The Bureau of the Census provides current data on the functioning of the housing market on a national and regional level. The survey of vacancy rates for units for sale or rent, the survey of market absorption

of new units in multifamily structures and the survey of completion of single and multifamily units as well as the survey of sales of new one-family homes indicate the characteristics of conventional housing units coming on the market and the rate at which units are absorbed. The recently introduced mobile home placement survey attempts to fill the same function for new mobile homes. The mobile home survey is expected to play a key role in ensuring that this significant source of new residential units is covered adequately in the sampling frames for the Census surveys. Data produced by the Bureau of the Census on construction activity, including new work and alterations and repairs are also relevant to the functioning of the housing market. These programs are described in the chapter on construction statistics.

The Bureau of Labor Statistics (BLS) is also a source of basic data concerning the housing inventory. The information is provided as part of the BLS Consumer Price Index and the Consumer Expenditure programs. The price index program supplies separate monthly estimates for owners and renters of trends in the components of housing costs for the Nation, 4 regions, and 25 cities. The Consumer Expenditure program includes data every 10 years on actual consumer expenditures for housing summarized by size of city and region. Plans for the Consumer Price Index and the Consumer Expenditure Survey are discussed in the chapter on price statistics.

The Bureau of Economic Analyses (BEA) provides measures of the current value of housing services (value added) as part of the national economic accounts. Summary data are published quarterly and detailed components are prepared annually. In addition, BEA prepares annual series on farm and nonfarm mortgage debt.

Analytical Agencies

The chief analytical agency in the housing field is the Department of Housing and Urban Development (HUD). Within HUD the Office of the Assistant Secretary for Policy Development and Research contains the largest emphasis on analytical efforts.

The Assistant Secretary for Housing and the Assistant Secretary for Community Planning and Development also have separate evaluation units responsible for analysis devoted to their respective areas. The statistical programs supported by the Assistant Secretary for Policy Development and Research (PD&R) include the Annual Housing Survey (AHS), the Survey of Market Absorption of New Rental Units, the Survey of New Housing Completions, the Survey of Sales of New One Family Housing and the Survey of Mobile Home Placements. In addition, PD&R coordinates a system of 11 monthly surveys which provide detailed data on gross flows of mortage credit including loan originations, purchases and sales of long-term mortgage loans and originations of construction and land development loans. The surveys are conducted by private trade associations as well as by Federal credit agencies and the Bureau of the Census.

PD&R is currently strengthening its capability to analyze the microdata tapes made available from the AHS. This should improve the Department's ability to monitor housing quality and the general performance of the market. The largest analytical effort handled by PD&R is the Housing Allowance Experiment involving demand, supply, and administrative components. This complex undertaking in the housing field is roughly analogous to the income maintenance experiments.

The Office of the Assistant Secretary for Housing provides a continuing series on the characteristics of insured mortgage transactions. For various reasons, the Federal Housing Administration (FHA) insured share of the housing market has declined significantly. Data based on these transactions, however, provide some of the most important insights concerning the characteristics of the current market. The office also provides detail on the characteristics of families moving into low rent public housing and other subsidized housing units and families re-examined for continued occupancy.

The Office of the Assistant Secretary for Community Planning and Development (CPD) oversees the distribution of planning funds, a portion of which are used by State and local governments for gathering statistics of housing used for local planning. In addition, CPD is responsible for oversight of the distribution of Community Development Block Grant (CDBG) funds under the Housing and Community Development Act of 1974. These funds are allocated to recipients on the basis of a legislatively mandated formula.

The Farmer's Home Administration and the Rural Development Service of the Department of

Agriculture are concerned with the analysis of rural housing. This is defined in the Housing and Urban Development Act of 1965 as housing in "...any open country, or any place, town, village, or city which is not part of or associated with an urban area...." In addition to these agencies, the Economics Unit of the Economics, Statistics and Cooperatives Service in the Department of Agriculture has devoted considerable effort to the analysis of the rural and farm housing situation.

The Veterans Administration provides data on the characteristics of mortgage loans guaranteed under the VA Loan Guarantee program for the veteran population.

The final group of agencies includes the federally sponsored financial agencies which in one way or another have a significant bearing on mortgage market developments. These agencies include the Federal Home Loan Bank Board, the Federal Home Loan Mortgage Corportion (FHLMC), the Federal National Mortgage Association (FNMA), and the Government National Mortgage Association (GNMA). Each of these agencies is vitally concerned with financial transactions in its area of responsibility and provides considerable detailed information on the nature of current financial transactions relating to housing. In addition, the Federal Reserve Board maintains detailed statistics on mortgage debt outstanding in support of its general responsibility for monetary policy.

User and Policy Groups

Statistics on the progress of housing and community development are of concern to the housing subcommittees of the Congress, to whom the Department of Housing and Urban Development (HUD) is required to report each year on progress in achieving the Nation's housing goal. Among other things the Department is required to "...compare the results achieved during the preceding fiscal year ...with the objectives established for such year under the plan..." and indicate necessary revisions in objectives (Housing and Community Development Act of 1968). The housing goal initially specified the elimination of substandard housing over the ten-year period ending in 1978. At the present time HUD is reviewing the methods used to estimate housing need as part of a broader assessment of future production and rehabilitation targets.

There are at least three additional broad policy areas for which statistics of housing and community development are of concern to government and private groups:

1. The construction and marketing of housing is followed closely by economic policymakers as a key sector of the national economy for which policy action has frequently been taken in order to help counter excessive expansion or contraction of general economic activity;

2. Detailed local data on housing and community development are required by HUD and other Federal agencies for the distribution of Federal grant funds, the underwriting of mortgage insurance, and the orderly functioning of financial markets; and

3. State and local governments are concerned with data comparing their situation with other communities and for determining priorities in government efforts to improve housing and neighborhoods.

Groups involved in every phase of housing and community development activity are concerned with the availability of data in their areas of particular concern. These groups include associations of State, county and local governments, including regional organizations; organizations of government officials and others with concern for public housing, urban development and planning; organizations involved in all aspects of building and marketing; and groups concerned with the housing of particular population groups, such as the elderly, the handicapped, and American Indians. On a continuing basis their data needs are made known to HUD and other agencies through extensive interaction at national and regional conferences. Additional opportunity for discussion of data needs is provided by the establishment of Census advisory committees to facilitate suggestions from outside experts concerning the content of quinquennial censuses of housing. Periodic conferences to discuss the content of the Annual Housing Survey with outside experts are conducted by HUD. Occasional reviews of selected aspects of housing and community development policy have helped to clarify the Federal role and to identify data needs. The most recent of these, and perhaps the most important in terms of the implications for housing statistics, was an in-house effort conducted by HUD in 1973 (Housing in the Seventies, a Report of the National Housing Policy Review). In the late 1960's the Douglas and Kaiser Commissions' reports also addressed the need for statistics within the context of broad reviews of urban policy and housing.

Adequacy of Housing and Community
Development Statistics

The adequacy of the basic programs providing statistics relevant to housing and community development is discussed under four broad headings: housing need, allocation of block grant funds, housing market analysis, and community development. An introductory section discusses the Federal role in the provision of local area data.

The Federal Role

Federal requirements for local area statistics on housing and community development include detailed data for selected localities for the analysis of current housing market activity and for the analysis of community development block grants. Data are also required to assess the viability and effectiveness of proposed projects, such as major home improvement loans and low and lower income housing assistance. Before addressing the requirements for the four broad areas mentioned above, it would be useful to consider the degree of Federal responsibility for providing local area data. (For related discussion see the chapter on Federal/State/local cooperative systems of data collection.)

The alternatives for dealing with the requirements for local area data range from making do with present data programs which means basically relying on periodic censuses, to the initiation of a vast new Federal effort to supply local area data on a current basis either directly or through underwriting locally initiated contracts. Somewhere in between these extremes are Federal efforts to help improve the useability of data produced as a byproduct of local programs, such as code enforcement, developing some local data by minimal expansion of current national and regional data programs and by using privately produced data.

Without Federal interest and support, the development of comparable local data sets would be slow. Yet the totality of local area data which might be useful to some analyst is virtually limitless. Under these circumstances the Federal Government should provide some encouragement for the improvement of local area data without becoming committed to providing a major share of the local area data that it would be useful to have for analytical purposes. The recently authorized mid-decade census program provides a promising step in this direction. The middecade program should provide benchmark data useable for updating the data employed in formula grants to minimize any gross inequities which may have resulted from the allocation of funds on the basis of decennial censuses.

The Federal Government should resist pressure to play a significant financial role in providing additional local area housing and community development data, much of which would be of low priority to many communities. A more promising approach for helping to satisfy local data needs in this field is to continue to encourage local governments to make the maximum possible use of data produced in the course of local government administration. Consideration should also be given to the use of data produced by utilities and firms specializing in the production of local data. Locally produced data, available in a conceptually standardized form and benchmarked to mid-decade or decennial censuses, should provide an adequate basis for determining local priorities involving housing and community development.

Housing Need

Current Federal requirements for data concerning housing need derive from the Housing and Community Development Act of 1968 which stated the goal "...of a decent home and a suitable living environment for every American family." Monitoring of progress towards that goal requires periodic detailed information concerning the characteristics of the population and its housing. For many purposes the decennial censuses of population and housing and the Annual Housing Survey are adequate vehicles for obtaining data broadly descriptive at the national level. However, there are important shortcomings in the data presently collected through these programs for assessing the adequacy of the housing inventory.

Assessment of progress toward the national goal requires reevaluation of what constitutes the attributes of adequate housing and neighborhoods. The former measures of physical condition which users combined in a concept of “standard housing" which were used with relatively minor variations in the censuses of 1940, 1950, 1960, and 1970 dealt only with certain of the physical attributes of individual structures. A new measure (or measures) should include: (1) the physical characteristics of the structure and its equipment, (2) objective measures of the environment of the neighborhood including community facilities or services, and (3) occupancy characteristics such as crowding, economic burden, suitability, and occupant satisfaction. Moreover, the former measure is obsolete in that: (1) research during the mid-1960's demonstrated that it was not possible to produce consistent ratings for individual housing units and areas smaller than census tracts and (2) it cannot be adapted to the self-enumeration techniques currently employed in the census.

Orderly progress in the development of measures of housing and neighborhood adequacy requires a continuing developmental effort. This effort should include the coordination of the investigation of the relationships between housing and neighborhood characteristics and a variety of social and economic phenomena which have a significant relationship to Federal policy issues. Among these are the relationships between housing and health, crime and neighborhood change, crowding and housing deterioration. Priority for study of the relationships should be given to the geographic areas of greatest concern, for example, the core census tracts of central cities, and rural communities.

The HUD Office of the Assistant Secretary for Policy Development and Research should coordinate a continuing interagency effort to develop measures of housing and neighborhood adequacy which have a significant relationship to Federal policy issues. This effort should include investigation of the relationships between housing and neighborhood characteristics and a variety of social and economic phenomena which are included in the HEW Survey of Income and Program Participation.

Assessment of progress towards the national goal also requires improved measures of the economic resources available to families in relation to their demographic characteristics, life stage and satisfaction with housing. This will permit assessment of the balance between the supply of housing of various types in relation to the ability to pay for it, including estimation of the amount of shortfall in economic resources for various groups in the population. With respect to economic resources, the decennial census and the Annual Housing Survey provide estimates of family income, but do not provide estimates of wealth. Improvements in the estimates of income and of wealth are part of the developmental program for the Survey of Income and Program Participation (SIPP) under development within the Department of Health, Education, and Welfare (DHEW). Improved estimating procedures for data on income and wealth which are used in the SIPP should be introduced into the Annual Housing Survey as soon as possible after development. Data relating to the cost of housing to the occupant should be improved through the introduction of estimates of the cost of maintenance and repair into the Annual Housing Survey program, or alternatively by adding data on household characteristics to some vehicle such as the Survey of Residential Additions, Alterations, Maintenance and Repair.

Another aspect of statistics related to meeting housing need concerns the value placed by the

occupants on the stream of housing services received from renter and owner occupied subsidized housing. Subsidized housing is a significant type of “in-kind” income for which the recipient's valuation is needed as an important input to the determination of an optimal mix of cash and in-kind aid. At the present time, little is known about the recipient's valuation of assisted housing. In order to provide data in this area, HUD should work closely with DHEW's developmental effort related to the Survey of Income and Program Participation.

Data on the inventory of mobile homes used or intended for use as residences is another area in which available data are deficient for assessing the adequacy of the housing stock relative to need. Improved data on the housing role played by mobile homes is of great importance because mobile homes are an essential source of new private housing for families in the lowest third of the income distribution. HUD should play a major role in developing a followon survey to the 1980 census to obtain detailed characteristics of mobile homes and their occupants.

In order to monitor changes in the housing stock relative to need, policymakers need to go beyond a purely descriptive approach to current data about the process through which change takes place. Change in the housing stock takes place through the addition, loss, division or combination of housing units. It is also frequently associated with changes in the population living in units basically identifiable as the same units over time. Data concerning the process of change is provided on the national level by the "components of inventory change" of the Annual Housing Survey. The "components" fill what was previously a serious gap in current data by making it possible to follow annual trends in the location, magnitude, and characteristics of housing losses and additions, and to evaluate requirements for new units in relation to the overall housing stock. The process of change in the population associated with the same units can be analyzed using data based on reinterviews of a fixed panel of the Annual Housing Survey, thus providing data relevant to the analysis of factors associated with the maintenance or deterioration of housing over time.

Allocation of Block Grant Funds

Title I of the Housing and Community Development Act of 1974 provides for the distribution of significant funds to local areas including metropolitan cities and urban counties according to a three-factor formula involving population, extent of housing overcrowding, and extent of poverty. In order to maintain the comparability of

the data among localities, it is necessary to employ data obtained from a common source. Current population estimates are used by HUD to update the population factor; however, the most recent source of comparable data for the remaining factors is the 1970 decennial census. As the age of the census data increases, the data are becoming increasingly less descriptive of the actual distribution of these factors.

Title II of the 1974 act imposes two additional data requirements as a basis for determining the allocation of housing assistance to local governments. Housing vacancies and substandard housing are specifically mentioned in addition to population, overcrowding and poverty, which are used for title I. For small areas, the additional information is available only from the 1970 decennial census. Moreover, the usefulness of vacancy data is relatively shortlived and subject to rapid change due to changing market and seasonal conditions. In order to minimize the inequities resulting from the allocation of funds on the basis of decennial censuses, the mid-decade census program should be used to provide benchmark data for updating the data employed in formula grants.

Housing Market Analysis

Concerns with both the supply and demand for housing are included in this topic. HUD and other agencies have a need to monitor changes in both sides of the market in order to develop policies for the national as well as the local housing market that will help assure a reasonable balance. On the supply side of the market, data are needed on interest rates, the volume and terms of transactions in existing units, costs of housing production and construction activity. On the demand side, data requirements include demographic estimates and projections, detailed estimates of the economic status of families, characteristics of market transactions and current intentions with respect to moving. Since much of the data of importance for analyzing the balance between the supply and demand for housing is covered in other chapters, only those aspects not covered elsewhere will be reviewed here.

At the broadest level of analysis, currently available data generally provide a moderately adequate overview with respect to major trends in housing supply and demand. Demographic estimates and projections indicate the trend of family formation and increases in the population; series on family income and factor costs indicate short- and long-term trends in the ability to pay for housing; and data series on construction starts and market absorption pinpoint current construction activity. In addition, the Annual Housing Survey provides