Residual Income Measure Promoted As Indicator of Housing Affordability

摘要

Michael E. Stone, a professor of planning and public policy at the University of Massachusetts-Boston, makes a case for using residual income, the after-tax amount available to a family after paying for essential non-housing costs, as an indicator of housing affordability and a standard to be used in housing programs. A specialist in housing affordability, Stone discussed this indicator in the latest issue of Housing Policy Debate, a Fannie Mae Foundation journal (Vol. 17, Issue 1, 2006). He described residual income as a more nuanced measure of what families can afford than the ratio of housing costs to income, which has long been the standard for federal programs. Initially 25 percent, the affordability standard was raised to 30 percent of income in the 1980s.