Mike Johnston, Denver’s new mayor, declared a homelessness emergency on his first day in office and set a goal of housing 1,000 people living without shelter in the city by the end of the year.
“We know it’s a crisis that has an impact on our economic recovery, it has an impact on public safety,” Johnston said Thursday, calling the issue a moral crisis during the “State of the City” luncheon held by the Denver Metro Chamber of Commerce.
Mayors of Aurora, Boulder and Colorado Springs joined him on stage in calling homelessness a top priority of their administrations, although they haven’t moved as forcefully as Johnston.
“We must solve these problems. Housing is the biggest issue,” said newly elected Colorado Springs Mayor Yemi Mobolade, who is studying ways to bring more efficient home construction into the city and looking into what steps Johnston and other mayors in the state are taking.
Aurora Mayor Mike Coffman said his city has outreach teams actively approaching people living on the streets with offers of assistance and services, but they are more often than not rebuffed.
“We don’t get very many takers,” he said, emphasizing that it is not compassionate for communities to let people live on the streets and that a “tough love” approach may be necessary.
And Boulder is looking at lifting restrictions on how many unrelated people can live in a household and in redeveloping industrial areas and parking lots on the east side of the city to provide housing, said Mayor Aaron Brockett.
A study from the real estate website Home Bay suggests what metro Denver and other regions with high home prices really face is an affordable housing crisis, of which homelessness is the most visible sign.
“Since 1985, housing prices have risen four times faster than incomes, even after adjusting for inflation,” said Matt Brannon, a data analyst with Home Bay’s parent company, Clever Real Estate. “The relationship between homelessness and housing affordability needs to be talked about more.”
The U.S. may be the wealthiest nation on the planet, but last year about 582,000 of its residents were homeless, the equivalent of Wyoming’s population. One of the most vexing problems is that economic prosperity does not improve housing outcomes, but more often than not, worsens them.
An analysis of the 50 largest U.S. metro areas that Brannon conducted found that those with home values above the national average have homeless rates 2.5 times higher than metro areas with below average home values.
Take San Jose, in the heart of California’s Silicon Valley, which epitomizes the nation’s high-tech prowess and ability to create high-paying jobs.
It boasts the lowest poverty rate among the 50 metros studied at 6.9%. Yet it also has the country’s highest typical home values at $1.39 million, and the nation’s highest homeless rate of 637 per 100,000 residents — 3.6 times the U.S. rate.
Despite all the brainpower and financial resources centered in northern California, the problem has proven intractable.
Right behind San Jose are San Francisco and Los Angeles, where the high rank on home values lines right up with the rank on the homeless rate — second and third. Seattle, Sacramento, Las Vegas, New York, Portland, Ore., and Denver all made the top 10.
Metro Denver had the seventh highest typical home value in the nation at $559,309, and the fourth-lowest poverty rate at 8.4%. It also had the 10th highest rate of homelessness at 231.6 per 100,000, based on 2022 counts from the U.S. Department of Housing and Urban Development.
“I think we need to address homelessness with multiple strategies – including providing safe places for those experiencing homelessness immediately,” said Jennie Rodgers, a regional vice president in Denver with Enterprise Community Partners, a national nonprofit that seeks to boost the supply of affordable housing.
More must be done to keep people in their homes and apartments through emergency housing assistance payments, legal assistance and rapid housing resources. Local governments must focus more on creating a stronger safety net for low-income residents, she said.
“But a comprehensive strategy must also include increasing the supply of truly affordable housing units that our very lowest-income Colorado residents can access – both those moving from homelessness and those who are currently housing insecure and in jeopardy of becoming homeless,” she said.
Colorado, for a variety of reasons, has been unable to provide housing affordable across a full range of incomes, at least on the level that Texas and other fast-growing non-coastal states have. Dallas ranks 38th for its homeless rate and Houston 47th. Even Austin, which like metro Denver has faced rapid home price gains due to strong in-migration, ranked 17th.
Although high home prices typically align with higher rents, renters are more likely to become homeless than homeowners. The Home Bay study also looked at that relationship.
Cities with higher rates of homeless have an average rent of $2,274 a month, while those with below-average homelessness have average rents of $1,596, based on the Zillow Observed Rent Index, which covers a broad range of rental properties.
The problem is also concentrated geographically. Western states hosted 10 of the 12 metros with above-average homeless rates. New York and Hartford, Conn., were the exceptions.
Atlanta, Pittsburgh, Chicago, Houston, and Cincinnati had the lowest homeless rates among U.S. major metros, all below 50 per 100,000 or under a third of the U.S. average of 175.5 per 100,000.
And Brannon points out five metro areas that have done better at bucking the correlation between higher housing costs and more homelessness — Atlanta, Miami, Boston, Charlotte, N.C., and Dallas.
Of those, Boston is the most comparable to Denver when it comes to home values — $577,160 vs. $559,309. Despite Denver having a slightly lower home value than Boston, its homeless rate is 2.5 times higher.
In 2015, Boston’s mayor at the time issued a comprehensive plan to reduce chronic homelessness called “Boston’s Way Home.” The program counts more than 15,000 people without shelter who have been housed. Only one in 50 homeless people in Boston sleep outside on any given night, the lowest rate of any major city and a fraction of the nearly four in 10 estimated nationally, according to the U.S. Department of Housing and Urban Development.
Mayor Johnston has planted his flag on addressing homelessness, but it is an issue other administrations have tried to tackle over decades. One of the more aggressive efforts was Denver’s “Road Home” program, a push in 2005 that then-mayor John Hickenlooper made to end homelessness in a decade.
Despite criticisms that outgoing Mayor Michael Hancock didn’t do enough, Denver boosted spending on homelessness from $8 million when he took office to $190 million authorized last year and another $254 million this year, including $77.7 million in federal dollars from the American Rescue Plan Act.
“There is no blanket solution to homelessness because the needs of individuals are so different,” said Rodger Hara, a principal with Community Builders Realty Services and a longtime consultant on affordable housing development
Denver could provide housing units for everyone on the street, but a certain percentage of the unsheltered will refuse them, he said.
And it won’t address what is pushing the majority of people into homelessness and sometimes keeping them there, the fundamental misalignment between incomes and housing costs, Brannon said.
Those who argue people experiencing homelessness in a high-cost housing market should move to a lower-cost one don’t understand how difficult it can be to make long-term plans when finding food and shelter that day are pressing issues, he said.
Someone living in San Francisco who has a good support system in place may actually fare worse by moving to Birmingham, Ala., where the support network isn’t as strong, he said. Plus, many experiencing homelessness remain in the cities where they have roots. They don’t want to leave.
“Cities with high homeless rates have services they provide,” he said.
The Home Bay study is based on 2022 numbers from the U.S. Census Bureau. A point-in-time count conducted on Jan. 30 across metro Denver and released on July 24 found a 31.7% increase in the number of people living in temporary shelters or on the streets across the metro area.
That number went up from 6,884 to 9,065 people.