II.

History

From the beginning of civilization, attention has been paid to the form, placement, and provision of human habitation. The earliest building codes, specifying structural integrity in housing construction, are found in the Code of Hammurabi (see Hammurabi, Code of). City planning activities during the Greek and Roman empires centered almost exclusively on the appropriate placement of urban housing from the perspectives of defense and water supply. These same concerns continued throughout the Middle Ages. In 13th-century Europe, the city became a center of trade, and its walls provided a safe haven from nomadic warriors and looters. People could find shelter for themselves and their flocks, herds, and harvests while the open country was being overrun by enemies of superior force. Demand for urban housing increased. For centuries this demand was filled by unplanned additions to, and subdivisions of, existing structures. Where climate permitted, squatting (occupying without title or payment of rent) became commonplace, but provided only temporary shelter.

By the 19th century, with the Industrial Revolution, people were moving to cities in unprecedented numbers. Workers lived in sheds, railroad yards, and factory cellars, typically without sanitation facilities and water supply.

In the postindustrial society of the 20th and early 21st centuries, housing in developing nations and poor parts of developed countries continued to be of insufficient quality and failed to meet the demand of some parts of the population. Vacant, abandoned central-city housing existed alongside structures that were usable but overcrowded and buildings that were structurally reclaimable but functionally obsolete.

At present, there is both a demand for housing and a supply of reusable structures that are going unclaimed. This situation is a good example of the complex role housing plays in society. Its primary function was to serve the need for shelter and privacy, but housing must now offer other advantages: (1) location, including proximity to the workplace, shopping, businesses, schools, and other homes; (2) environment—that is, the quality of the neighborhood, including public safety and aesthetics; and (3) investment potential, or the degree to which home ownership may affect capital accumulation.

A.

Housing in the United States

The physical stock of housing in the United States is one of the nation's principal capital assets. The unique aspects of housing in the United States are its density and how it is provided. In the United States, about two-thirds of the population live in single-family homes, most of which have been built by small, private housing developers on separate lots. America's housing industry is a largely unorganized group of entrepreneurs who construct housing in their own geographical area. They decide on the type of housing that will be accepted by consumers and then proceed to provide this housing through the development process.

Various laws, institutions, and public agencies work to ensure that private-market housing is produced safely by builders and delivered efficiently to consumers. The quantity and type of housing are controlled by zoning laws; the quality of the housing and the inclusive services to be offered are determined by building or housing codes. Financing needed to construct and purchase housing is available from lending institutions whose activities are governed by law. Consumers are afforded access to this housing through a variety of settlement procedures and fair-housing laws.

Housing has been built in the United States in an outward progression from major cities, such as New York City and Chicago, first following rail and trolley lines and then automobile paths such as major roads, beltways, and interstate highways. Housing in the city was generally either single-family homes (one unit on one lot, typically of frame construction) or multifamily dwellings (multiple apartment units on a single tract of land, often of masonry construction).

B.

Suburban Housing

The growth of suburban housing in the United States began in the 1920s, but was stalled by the Great Depression of the 1930s and by World War II (1939-1945). In the postwar era of the 1950s, a tremendous surge occurred in the suburban housing market. Single-family homes on relatively small lots (often less than one-tenth of an acre) sprang up. During the 1950s, many large “tract” developments encroached on former farmlands near metropolitan areas. The growth of housing created significant demand for schools and other public services in these locations.

By the 1960s, builders were constructing larger homes on larger lots. A new development was the emergence in the suburbs of so-called garden apartments, usually abutting commercial districts. Garden apartments are two- to three-story brick and frame structures containing between 5 and 30 housing units per structure. These apartments were popular with young married couples with insufficient capital to purchase their first home.

In subsequent suburban housing development, traditional housing was embraced but new forms were also introduced: the townhouse, a single-family attached dwelling; the triplex and fourplex, three- and four-family structures; and mobile or modular housing, which has become significantly more popular during the last 20 years, because it is inexpensive and easy to construct. In addition, as ownership of housing has had compounding income-tax benefits, other changes have taken place. Increasingly, condominium and cooperative ownership arrangements have replaced rental tenancy in apartment buildings (see Real Estate).

C.

Amount of Housing

The U.S. Census Bureau defines a housing unit as “a house, an apartment, group of rooms or a single room, occupied or intended for occupancy as separate living quarters,” with (1) direct access to the unit from the outside or through a common hall and/or (2) complete kitchen facilities for the exclusive use of occupants. Transient or institutional accommodations and barracks for workers are not counted as housing units. As of July 2007 about 128 million housing units existed in the United States, according to the Census Bureau.

D.

Housing Regulations and Federal Aid

The earliest public involvement in housing in the United States was the establishment of housing codes. One of the first, the New York Tenement Law of 1867, regulated the physical conditions and maintenance standards of apartment houses in New York City. A more sophisticated and elaborate code was adopted in 1901. Other states, including Massachusetts and Pennsylvania, soon followed suit.

The federal government was first induced to regulate housing when the nation entered World War I in 1917. This event sparked the expansion of defense plants, thus straining the housing supply for war workers at particular locations. To handle this problem, Congress formed the U.S. Housing Corporation, which remained in existence until the end of the war in 1918.

D.1.

The Depression Years

A housing boom occurred in the United States during the 1920s, but activity plummeted during the Great Depression in the 1930s. This downturn prompted dramatic federal housing programs. The Home Owners’ Loan Corporation was formed in 1933 to refinance existing home loans. More durable were the activities of the Federal Housing Administration (FHA) authorized in 1934. The FHA insured residential loans and thus encouraged lenders to offer long-term (20- to 30-year), fixed-rate mortgages. FHA housing activity received further support when the Federal National Mortgage Association (FNMA) was created in 1938. The FNMA purchased FHA-insured loans, thus establishing an important secondary market and liquidity (ease of turning into cash) for local savings and loan associations.

During the 1930s a public housing program was created to provide slum clearance and low-cost housing for the poor. These activities were implemented by local housing authorities, which received federal financial assistance. Such public support systems stimulated housing activity in the late 1930s; the advent of World War II (1939-1945), however, brought all but essential housing construction to a halt.

D.2.

The Postwar Era

In the late 1940s and 1950s, the federal government continued the FHA, the FNMA, and public housing supports and also added new programs. The Veterans Administration, for example, guaranteed home loans obtained by veterans through a program authorized in 1944; together with FHA insurance, this encouraged development of the postwar suburban land subdivisions.

The most significant programs and strategies in the postwar period were provided by milestone legislation. Numerous housing acts provided subsidies for slum demolition, rental housing rehabilitation, and low-income home ownership. The Housing Act of 1949 authorized “urban renewal” of slum areas. Under this act, local redevelopment authorities purchased and demolished deteriorated properties and then sold the cleared tracts to private developers for a nominal sum. The goal of urban renewal was to replace slum areas with new residential and nonresidential units. The program came under criticism, however, as a strategy that overemphasized demolition, often to the detriment of viable neighborhoods and poor or minority residents.

In the 1960s the federal government increased and changed its housing involvement. Instead of demolition, housing rehabilitation was encouraged. In addition, new and expanded housing subsidies were provided for poor and minority households. The Housing Act of 1965 created the program that made subsidies available for low- and moderate-income rental units, and it also authorized the subsidy that fostered home ownership by the poor. The housing needs of inner-city areas were to be met by specially targeted subsidies. The best-known subsidy plan was the Model Cities Program (authorized by the 1966 Demonstration Cities Act), which focused on upgrading the physical (housing, public facilities) as well as the social (education, job training) aspects of inner-city areas.

The many federal housing efforts were administered by the Department of Housing and Urban Development (HUD), which was created as a cabinet-level agency in 1965. In addition to urban programs, HUD also was in charge of aiding new towns—self-contained communities incorporating integrated residential and nonresidential uses. See Housing and Urban Development, Department of.

D.3.

The 1970s and 1980s

Problems in the existing housing programs began to emerge in the 1970s. Subsidized rental projects were foreclosed. Single-family units bought by the poor increasingly were abandoned by their new owners. Several of the privately developed, publicly assisted new towns experienced near or actual bankruptcy. These conditions evoked a moratorium on further subsidies and caused a redirection of approaches to housing problems. Assistance began to take the form of block grants; the Community Development Block Grant (CDBG) program, authorized by the Housing Act of 1976, was the most significant example. The CDBG program, an effort to allow flexibility in local housing problems, was a more broad-based and encompassing housing subsidy. It provided “blocks” of money for coordinated urban revitalization. The allocation of block grants was a primary redevelopment approach in the 1980s, although the funding for CDBG and similar programs had been significantly reduced.

The 1980s were characterized by a change of emphasis in national housing policy. Because of federal budget constraints, the emphasis shifted from rebuilding the most dire neighborhoods to improving “gray” areas that were just beginning to decline. HUD ordered a stop to the construction of new subsidized low-income housing. The government realized it would be more cost effective to rehabilitate and preserve existing structures than to build new ones. In many cities, private ventures were encouraged, such as the renovation of brownstones and row houses. None of these actions helped poor people, and the housing shortage worsened. See also Building Acts.