The Economist: US faces worst homelessness surge in decades as housing costs, migration surge

Homelessness in the United States has reached its highest level on record, with the number of individuals experiencing homelessness rising by 18% from 2023 to 2024.

A recent nationwide survey revealed that approximately 771,000 people were homeless in January 2024, a stark reflection of the growing crisis, Caliber.Az reports via The Economist.

Contributing factors include a severe housing shortage, rising rents, an influx of asylum seekers, and the lasting impacts of natural disasters. Despite the troubling statistics, there are glimmers of hope, including a significant reduction in homeless veterans and signs that the crisis may stabilize in the coming years. 

The rise in homelessness is attributed largely to people living in shelters—whether in temporary hotel rooms or shelters filled with cots—rather than those sleeping rough in public spaces, commonly seen in states like California and certain southern regions. However, the most shocking revelation was a 39% increase in family homelessness, reversing a gradual decline that had been observed prior to the COVID-19 pandemic.

Experts point to three main drivers behind the surge in homelessness: a chronic housing shortage exacerbated by rising rents and home prices, an influx of asylum seekers, and natural disasters that displaced residents. According to Moody’s Analytics, the US is facing a shortage of approximately 2.9 million affordable homes. This shortage is particularly evident in states with high housing costs, such as California and New York, which have some of the highest homelessness rates in the country. Other states, including Hawaii and Massachusetts, have also seen significant increases.

The report also highlights the vulnerability of certain groups within the homeless population, including those who are chronically homeless, many of whom struggle with mental health issues or addiction. These challenges make it more difficult for them to maintain stable housing. However, the majority of people experiencing homelessness cycle in and out of unstable living situations due to financial instability, with the expiration of pandemic-era rental assistance and eviction moratoriums pushing many into homelessness.

The crisis has been compounded by an influx of migrants arriving in US cities, often bused from southern border states like Texas. Chicago, Denver, and New York City were among the most impacted, with migrants overwhelming shelter systems. In Chicago, for example, migrants found refuge in police stations, while Denver created its own busing program to distribute migrants to other destinations. As a result, these cities saw corresponding increases in homelessness, with New York City attributing nearly 88% of its rise in homelessness to the housing of asylum seekers in the city’s shelters.

Natural disasters have also played a critical role in escalating homelessness. The tragic wildfire in Maui, Hawaii, in August 2023 destroyed the town of Lahaina, leaving many survivors homeless. The disaster worsened an already dire housing shortage on the islands, where housing costs are among the highest in the nation. A similar pattern emerged in California after the 2018 wildfire in Paradise, California, displaced thousands.

Despite these grim statistics, there are a few signs of hope. One positive development is that the January count was conducted shortly after a peak in migrant arrivals, and cities have since adapted to the influx. Denver, for instance, has wound down its migrant shelter programme, and with migrants settling into new areas, the number of homeless individuals may begin to decline in 2025.

Additionally, a rare bright spot in the report is the significant reduction in the number of homeless veterans. Since 2009, homelessness among veterans has dropped by more than 50%, largely due to better cooperation between local governments and the federal Department of Veterans Affairs.

As policymakers and advocates seek solutions to address this worsening crisis, the success in tackling veteran homelessness serves as a potential blueprint for broader efforts to combat homelessness across the nation.

By Aghakazim Guliyev