Causes of
Homelessness

Despite stereotypes that oversimplify the nature of homelessness, the true causes of homelessness are complex and nuanced. Rather than stemming from any single cause, homelessness is typically the result of several compounding and interrelated factors that vary from person-to-person. And a deeper examination will find that the root causes of homelessness lie in entrenched, long-standing social inequities.

Why Do People Fall into Homelessness?

In surveys conducted during the biannual Point-in-Time Count, homeless individuals report a wide-range of different “primary causes” for their homelessness – none of which came close to representing a majority of individuals: 1While the PIT survey specifically asks respondents to report a ‘primary cause’ It’s also worth noting that many homeless individuals commonly attribute their homelessness to a combination of interrelated or compounding factors.

While the data fails to point to any predominant cause, the most commonly reported factors relate to economic problems or changes in household dynamics. Dispelling the myth that alcohol and drug use are the main drivers of homelessness, we see a significantly higher percentage of people citing a job loss as the primary cause of their homelessness.

These varied responses also reflect that homeless individuals commonly report multiple, compounding factors – rather than one single cause – that ultimately pushed them into homelessness.

The Root Causes of Homelessness in Our Community

“Homelessness is a societal failure, not an individual one. It’s important to distinguish between root causes and individual factors, these issues intersect but are not the root causes.”

Jeff Olivet, U.S. Interagency Council on Homelessness (ICH) Executive Director in Exploring the Systemic Causes of Homelessness

While homelessness is often perceived as the result of a personal or moral failure, the individual factors that contribute to homelessness are rooted in structural problems plaguing our society. Here, in Santa Clara County, we can point to a few key systemic forces that are pushing even more of our neighbors into homelessness every day:

A Lack of Affordable Housing

A Lack of Affordable Housing

The single greatest systemic cause of homelessness is a lack of affordable housing.

For decades, Santa Clara County (and the larger Bay Area) has failed to produce enough housing to match the needs of our growing population. This constrained supply has resulted in skyrocketing rents that has made most housing units simply unaffordable for a large segment of residents.

To make matters worse, our community continually falls short of our development targets for subsidized low-income housing units – particularly when it comes to units dedicated to Extremely Low Income residents (our lowest-income residents earning less than 30% of the area’s median income – or appx. $50,000 for a family of four in Santa Clara County).

As a result, we have a huge shortfall of affordable and available housing in our community – with the National Low Income Housing Coalition estimating that there are only 32 affordable and available rental units for every 100 extremely low income households in our community. 2National Low-Income Housing Coalition, “The Gap: A Shortage of Affordable Homes.” 2022. https://nlihc.org/sites/default/files/gap/Gap-Report_2022.pdf

With so few affordable housing options available, the vast majority of our lowest-income families and individuals are left severely rent burdened (meaning they spend more than 50% of their income on rent and utilities) and often just one crisis away from homelessness. Data shows communities where people spend more than 32 percent of their income on rent can expect a more rapid increase in homelessness.

In their book, “Homelessness is a Housing Problem,” researchers and authors Clayton Page Aldern and Gregg Colburn correlate rent levels and vacancy rates to regional rates of homelessness, demonstrating that homelessness is rooted in a housing problem and more specifically – a lack of affordable housing for lowest-income households.

Many other common explanations – drug use, mental illness, poverty, or local political context – fail to account for regional variation.

Homelessness is a Housing Problem (2022)

Rising Economic Inequality

Rising Economic Inequality

Our homelessness crisis has been further compounded by our region’s growing income gap.

Over the past few decades, our region has become a global economic engine that has created enormous wealth for those with high-paying jobs in tech and other major industries. However, our lowest-income workers – including those in the service industry or who rely on minimum wage jobs – have not reaped the same benefits. In fact, Santa Clara County workers at the bottom rungs of the economic ladder have actually seen wages decline over the past two decades. 3Bay Area Equity Atlas, “Earned income growth for full-time wage and salary workers: Santa Clara County, CA, 2000–2019.”
https://bayareaequityatlas.org/indicators/income-growth#/?geo=04000000000006085

According to the Public Policy Institute of California, the wealthiest 10% of families in the Bay Area now have more than 12 times the income of the 10% of families with the lowest incomes in the region. 4Public Policy Institute of California, “Income Inequality in California.” 2020.
https://www.ppic.org/publication/income-inequality-in-california/

As a result, it is now virtually impossible for our lowest-income workers to keep up with the rising cost-of-living – and particularly exorbitant housing costs – being driven by the region’s high-wage earners. A Santa Clara County resident would need to earn $46/hour to afford the average-priced apartment on the market. 5California Housing Partnership, “Santa Clara County 2021 Affordable Housing Needs Report.” 2021. https://1p08d91kd0c03rlxhmhtydpr-wpengine.netdna-ssl.com/wp-content/uploads/2021/05/Santa-Clara_Housing_Report.pdf

Underinvestment in Programs Serving our Most Vulnerable Residents

Underinvestment in Programs Serving our Most Vulnerable Residents

Over the past several decades, policymakers have failed to maintain a strong safety net to support our most vulnerable residents. We’ve continually seen underinvestment, as well as outright spending cuts, to programs that are critical to helping our most vulnerable residents maintain stable housing (i.e. low-income housing subsidies, disability benefits, financial assistance programs).

In the most stark example, a lack of investment in federal housing initiatives has resulted in just one out of four low-income at-risk renters receiving Federal rental assistance:

This lack of investment in our most vulnerable families is even more shameful given that the resources are often shifted towards programs that benefit higher-income individuals. For example, the money spent on the mortgage tax deduction and capital gain exemptions for homeowners far exceeds the federal housing subsidies available for low-income renters. 6Center for Budget and Policy Priorities, “Federal Housing Spending is Poorly Matched to Need.” 2017.
https://www.cbpp.org/research/housing/chart-book-federal-housing-spending-is-poorly-matched-to-need

As a result, our most vulnerable residents have been left without the resources and support needed to maintain stable housing and avoid homelessness.

Systemic & Structural Racism

Systemic & Structural Racism

For communities of color, structural racism accelerates these inequities. Our history of systemic racism – and the way it has prevented people of color from accessing housing, community resources, opportunities for economic mobility and more – continues to play a major role in our homelessness crisis.

For example, decades of discrimination in the housing market have prevented people of color, particularly African Americans, from attaining homeownership and building personal wealth. This has created an enormous racial wealth gap that has sustained over multiple generations. In fact, the average white household has six times more wealth than the average African American household. 7Bhutta, Neil, Andrew C. Chang, Lisa J. Dettling, and Joanne W. Hsu (2020). “Disparities in Wealth by Race and Ethnicity in the 2019 Survey of Consumer Finances,” FEDS Notes. Washington: Board of Governors of the Federal Reserve System, September 28, 2020, https://doi.org/10.17016/2380-7172.2797. https://www.federalreserve.gov/econres/notes/feds-notes/disparities-in-wealth-by-race-and-ethnicity-in-the-2019-survey-of-consumer-finances-20200928.htm

With so much less accumulated wealth available to weather a crisis, it should come as no surprise that African Americans and other people of color are more likely to be extremely low income and so much more susceptible to falling into homelessness. And race continues to shape opportunities for upward mobility in the Bay Area and across the country, even when starting from the same economic standing. Data shows that in 99% of neighborhoods in the United States, black boys earn less in adulthood than white boys, despite both growing up in two-parent families with similar levels of income, wealth, and education.

You can learn more about the root causes of homelessness – and the proven solutions – straight from nationally renowned experts in Exploring the Systemic Causes of Homelessness, a webinar presented by Destination: Home and San Jose Spotlight in celebration of Affordable House Month 2022. Watch it here.

When taken together, these systemic forces have created an environment where a growing number of our neighbors are being pushed into homelessness every day. And while these forces are particularly strong here in the heart of Silicon Valley, they are hardly unique to our community. A growing body of scholars and experts have directly linked a number of these very same factors to our current homelessness crisis in America. 8For a deeper dive into the research on structural causes of homelessness, we recommend browsing the resources on the National Alliance to End Homelessness website:
https://endhomelessness.org

While all of this evidence points to how deeply ingrained homelessness is intertwined to other problems plaguing our society, it also offers a signal of hope: since homelessness is truly the result of our own collective actions as a society, it also means that we have the power to solve this crisis.

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