A new report by the National Low Income Housing Coalition reminds us that the housing crisis is nothing new for low-income renters. As early as 2005, very low-income households, except for those with housing assistance, were paying, on average, 82% of their income for rent.
But if the affordable housing crisis isn’t new, it’s certainly worse. An estimated 40% of households displaced by foreclosures have been renters. They’re now competing for affordable units with former homeowners. Yet, before the end of 2007, the market was already short 2.8 million units that low-income renters could afford.
What does this mean for low-income families? NLIHC answers this question by calculating the amount a household would have to earn to afford a modest two-bedroom apartment, plus basic utilities. In other words, how much would an individual or family have to earn for the fair market rent that HUD assigns the apartment to constitute no more than 30% of their income?
We may know that affordable housing is a problem, but the figures NLIHC reports are eye-opening. Nationwide:
- There’s no state where a minimum wage earner can afford the two-bedroom apartment–or, for that matter, a one-bedroom unit.
- In 30 states, more than two full-time minimum wage jobs would be required to afford the two-bedroom unit.
- In 15 states, the fair market rent for an efficiency is greater than the entire amount very low-income elderly and disabled individuals receive in Supplemental Security Income (SSI).
And here are what I guess I should call the lowlights for the District of Columbia:
- Since 2000, the hourly wage a household would have to earn to afford the two-bedroom apartment has increased 51%.
- Today, the household would have to earn $24.77 per hour, assuming full-time, year-round employment–or about 3.3 times the minimum wage.
- For extremely low-income households, i.e., those whose 2008 incomes were $29,7000 or less, the two-bedroom apartment costs about 40% more than they can afford.
- The gap between the cost of the apartment and what individuals who rely on SSI can afford is $1,086 per month–about 1.6 times the total maximum SSI benefit.
Yet, as the DC Fiscal Policy Institute reports, the proposed Fiscal Year 2010 budget for the District would cut local funding for affordable housing by an additional $11 million. That would mean $45 million less than the amount originally approved for this fiscal year.
Could the District balance the budget without giving short shrift to the affordable housing crisis? DCFPI apparently thinks so. Happily, at least one City Council committee agrees. More about this in another posting.