Last week, I talked about our region’s Housing Needs Assessment. Our nonprofit, Data-Driven Economic Strategies, assisted in this work but we led an in-depth portion of the analysis examining the impacts of reduced housing affordability on homelessness within El Paso County.

The first portion of our analysis looked at the 2024 Point in Time (PIT) homelessness count, which identified 1,146 individuals as homeless within El Paso County.

Nationwide, these counts are notorious for underestimating the homeless population because the counts are done during the cold month of January and they rely on volunteers within certain parts of the city. National estimates are that PIT estimations are three to 10 times lower than the actual number of homeless. As such, we looked at various alternative measures such as Supplemental Nutrition Assistance Program applications, which showed roughly 8,500 homeless people in El Paso County. This is seven times the local PIT count keeping in line with U.S. studies on the flaws and underestimation associated with point-in-time counts.

Other sources such as school counts of homelessness (via the McKinney-Vento Act) identified more than 1,600 homeless K-12 students in 2024. This (student population) alone is less than the PIT counts. Different measures count homelessness differently, but the general trend across all other data sources we looked at is a vast (point-in-time) undercounting.

From an academic perspective, one point in time is typically not used in rigorous studies precisely because they are a point in time. And to answer a humorous question I got at a city presentation, homeless individuals do not count adult kids in basements.

The next part of the study was to estimate the risk of additional homelessness due to high rents and home prices. We relied on a national study of 381 communities (conducted by Boston University and the University of Pennsylvania under the auspices of Zillow Research) that gave probabilities of becoming homeless based on income and housing costs.

Calculations use the number of households that fall into either extremely or very low-income categories and as such have high rent or mortgage burden. Using the national study’s probabilities, we found that 1,551 households, or about 3,925 additional individuals in El Paso County are at high risk of becoming homeless due to extremely high housing cost burdens alongside very low income levels. These local estimates are above and beyond existing homelessness.

Housing costs are up about 50% since early 2020, and homeowner’s insurance premiums are up more so. These are, of course, major factors in this increased risk of homelessness. This is true locally and across the U.S. Another principal local factor is that average wages are lower than the U.S. and that creates a disproportionate mismatch between local wages and local housing costs.

Our region does have some wonderful resources available to help provide temporary and permanent housing for struggling individuals and households and no doubt that helps many people who need it the most. However, as a result of our analysis and as an economist, I can say that containing homelessness is unfortunately an upward battle simply due to stagnant (inflation-adjusted) wages for the average worker alongside elevated housing costs.

As I stated last week, all studies point to the need for innovative thinking around affordable housing. I think our state and region can distinguish themselves nationally as clever and innovative such that we attract and keep workers and families while caring for vulnerable populations. I’ve been struck by the number of (now financially) stable community leaders and residents who tell me about some period in their lives when they hit a tough financial patch due to neglectful parents, parents who lost jobs, divorce or abandonment as adults often with children to provide for, a history of substance abuse or other life challenges.

They all say that the negative spiral with finances just makes matters worse — and often that community resources made all the difference. I believe innovations around affordable housing can be one important piece of that puzzle that can help lower financial barriers all around.

The full 13-page DDES report can be found on the City of Colorado Springs website.
Tatiana Bailey is executive director of the nonprofit Data-Driven Economic Strategies. Other Gazette articles, TV segments, DDES monthly economic dashboards with technical explanations, and how to sponsor their work can be found at ddestrategies.org.