SAVI Reports - Page 22

that are earning less than $35,000. These data would suggest that the housing choices of those making more than $50,000 are limiting supply to those in lower income cohorts. This not only has a profound impact on families in their housing; it also has an impact on the degree to which those families are able to expend resources in other facets of their life. Families that spend less than 30 percent of their income have residual income leftover to invest in themselves, their education and the education of their children, their retirement, or even a vacation. Those at the other end—those spending more than 30 percent of their income—may be forced into difficult choice s about spending money on basic needs, utilities, or medical bills. In considering the costs of transportation alongside the costs of housing, we find that much of Central Indiana is indeed unaffordable. Transportation, the Hidden Cost of “Affordable” Homeownership If lower-income households only have access to housing options that were left by those with higher incomes, low-income households that desire to be homeowners may be forced to “drive until you qualify,” seeking out affordable housing in new greenfield developments at the outer edges of the metropolitan area (accepting the ongoing and variable costs of transportation in the process). The Center for Neighborhood Technology maintains the Housing and Transportation (H+T) Affordability Index, which factors in the cost of transportation and resets the affordability threshold to housing + transportation costs at 45 percent of household income. Figure 11, page 9, compares affordability in Central Indiana based only on housing (the 30 percent threshold, left map) and based on housing + transportation (45 percent threshold, right map). Considering the costs of transportation alongside the costs of housing, we find that much of Central Indiana is indeed unaffordable. These costs are hidden from the traditional data sources in the sense that the US Census does not report transportation costs alongside housing costs (they do provide insights on how far workers commute and by what means). 18