The housing bubble is history. Mortgage rates have plummeted. One would think that housing should be more affordable for full-time workers. A new report by the Center on Housing Policies says this is generally true for workers with the income and the credit to purchase a home.
But for many workers, rental housing is no more affordable than it was two years ago–and in some places less. In the 210 metro areas CHP reviewed, fair market rents for a two-bedroom apartment increased by a median average of 2.8% last year.
Using salary data for occupations in each geographic area, CHP calculated affordability, using the U.S. Department of Housing and Urban Development’s 30% of income standard.
What it found nationwide is that only some of those touted “green jobs” paid enough to make the two-bedroom apartment affordable. It was unaffordable for insulation workers in a nearly a third of the metro areas and for maintenance and repair workers in almost as many.
The situation was worse for workers in some more common fairly low-paying jobs. Retail salespersons earned, on average, only about 58% of what would make the apartment affordable. In fact, in 84% of the metro areas, they didn’t earn enough to afford even a one-bedroom apartment at the fair market rate.
Janitors earned, on average, only 64% of what would make the two-bedroom apartment affordable and enough for the one-bedroom apartment in only 58 metro areas. While licensed practical nurses generally earned enough to make the two-bedroom apartment affordable, their wages fell short in 55 metro areas–more than a quarter of the total.
CFP has a nifty online tool that let’s you look at sets of preselected jobs by metro area or choose as many as 10 jobs from a lengthy list. So I, of course, drilled down to Washington, D.C. Key findings here:
- The two-bedroom apartment was unaffordable for workers earning the average in all five of the preselected “green jobs,” including environmental and electrical engineering technicians.
- It was also unaffordable for workers in all five other the other preselected jobs, including elementary school teachers and police officers.
- Even a one-bedroom apartment at the fair market rate was unaffordable for LPNs, janitors and retail salespersons. The latter two, in fact, earned, on average, less than half of what would make that apartment affordable.
- General office workers don’t fare much better. Administrative assistants, secretaries, clerks and receptionists all earned, on average, less than what would make the one-bedroom apartment affordable here.
- And, of course, things get even worse for workers in low-skill jobs. Dishwashers and wait staff, for example, earned, on average, less than a third of what would make the one-bedroom apartment affordable. Housekeepers earned well less than than half.
Advocates often focus on affordability issues for very low-income households, i.e., those with incomes at or below 30% of the area median average. These, of course, include households with no wage earner and those with earners who work only part-time or intermittently.
What I find striking is that housing here in the District and in many other metro areas is unaffordable for workers in a fairly wide range of jobs, including those that require postsecondary education and/or specialized training.
Imagine the housing burdens on jobless and low-wage residents when even teachers can’t afford a modest two-bedroom apartment. Consider how housing costs diminish the vitality and diversity of our community.
We clearly need to shore up the District’s affordable housing programs, budget constraints notwithstanding. As the DC Fiscal Policy Institute recently reported, funding for core local programs is just over half what it was two years ago.
But I think we also need to take another look at the policies and practices that have resulted in the loss of more than a third of the District’s low-cost rental housing units since 2000. Clearly, condo conversions, gentrification and the like are outstripping affordable housing production.
They’re squeezing–or squeezing out–low-income residents. They’re also, I would guess, deterring middle-income workers, including our public servants, from sinking their roots in our community.