U.S. Homelessness Reached an All-Time Peak in 2021
Over 770,000 individuals encountered homelessness in 2024, marking an 18% rise from 2023, as per the US Department of Housing and Urban Development's report. This was the most substantial yearly increase since 2007 (disregarding the escalation from 2021 to 2022, when the agency didn't conduct a comprehensive count due to the Covid-19 pandemic).
The escalation in homelessness was largely attributable to a scarcity of budget-friendly housing, an upsurge in migrants seeking refuge, and natural disasters, which led certain individuals to lose their residences, the report indicated.
The data was gathered during a single night in January 2024 and serves as an annual overview of the number of people residing in shelters, temporary housing, and uninhabited settings.
The data from early 2024 might not accurately depict the current homelessness scenario, as per HUD, given the administration's initiatives to restrict border crossings. Nonetheless, the report offers a grim glimpse into the regrettable consequence of America's housing affordability crisis. After decades of insufficient housing construction, demand has significantly surpassed supply. This only fueled property prices to historic peaks in 2024. The expense of procuring a home through borrowing remained alarmingly high throughout the year, even as the Federal Reserve decreased interest rates by three instances in 2024. The average 30-year fixed mortgage rate stood at 6.85% last week, down from the high of 7.22% earlier in the year.
Rents have persisted in escalating since momentarily retreating during the pandemic. As of 2023, almost half of renters were spending more than 30% of their income on housing, thereby qualifying as financially strained, according to the US Census Bureau.
“No American should experience homelessness, and the Biden-Harris Administration is dedicated to ensuring that every family has access to the inexpensive, secure, and high-quality housing they merit,” Adrianne Todman, the US Secretary of Housing and Urban Development, declared in a statement. “Though this data is now nearly a year old and no longer mirrors the present situation, it is crucial that we concentrate on evidence-based strategies to prevent and eradicate homelessness.”
The HUD report unveiled that numerous cities witnessed an increase in homelessness compared to the previous year, except for Dallas and Los Angeles, which recorded a decrease.
Veterans were one group that displayed notable improvements in their long-term housing prospects, however. Homelessness among veterans fell by nearly 8% from the previous year to the lowest level ever recorded, from 35,574 in 2023 to 32,882 in 2024. In 2024, the Department of Veterans Affairs reported housing the largest number of homeless veterans since 2019.
The escalating housing costs and lack of affordable housing options in 2024 significantly contributed to the business of providing temporary shelter for the homeless. Despite the Federal Reserve's efforts to lower interest rates in 2024, the average 30-year fixed mortgage rate remained high, leaving many individuals financially strained and unable to afford housing, resulting in historic peaks in homelessness.
