The hourly rate you need to afford a two-bedroom apartment in every state

[GMDino]

Quote:

You probably won’t be surprised to hear that there isn’t a single state in the U.S. where a worker earning minimum wage can afford the rent for a two-bedroom apartment — or, for that matter, a one-bedroom apartment. You might be surprised to learn that there isn’t a state where renters earning average pay can afford a two-bedroom apartment, either.

(This story is part of my Restless Project: Why Americans Can’t Sleep at Night.)

The National Low Income Housing Coalition crunched the numbers recently and found that a toxic mix of stagnant wages and rising rents has made things really difficult on a wide swath of U.S. wage-earners. It calculated a “housing wage” by determining how much workers would have to earn hourly to afford a “fair market rent” apartment for 30% of their income. By that measure, the national housing wage is $20.30 for a two-bedroom unit and $16.35 for a one bedroom — both far above even recently increased minimum wages.

But in many parts of the country, the numbers are even bleaker. Near Washington, D.C., the two-bedroom rental wage is about $31 an hour. In New York, it’s $27. In Maryland, it’s $26. In fact, in six staes and D.C., the housing wage is north of $25 an hour, the report says.
(This story first appeared on Credit.com. Read it there.)

Another way of expressing the same problem: Using the national rates, a worker earning the federal minimum wage of $7.25 per hour would need to work 2.8 full time jobs, or approximately 112 hours per week, to afford a two-bedroom apartment. That renter would need to work 90 hours to afford a one-bedroom, according to the report.

“In only twelve counties and one metropolitan area is the prevailing minimum wage sufficient to afford a modest one-bedroom apartment,” the report says. Those regions are all in West Virginia and Washington state.

Meanwhile, the average hourly wage of renters in the U.S. is $15.42, which is $4.88 less than the two-bedroom housing wage.

“In no state is the mean renter wage sufficient to afford a two-bedroom apartment at the fair market rate,” the report points out.

Here’s one example of the troubling numbers at work:

In Washington state, fair market rent on a two-bedroom apartment is $1,203. That means a worker needs annual earnings of about $48,000 to afford that unit, or $23.13 per hour. Based on the state minimum wage, a worker would need 2.4 jobs full-time jobs to afford that. The real average renter wage in Washington is just $16.69, meaning a worker with an average-pay job needs 1.4 jobs to afford a two-bedroom place. In King and Snohomish counties, the region’s most expensive areas, the housing wage is much higher: $29.29.

Part of the problem is skyrocketing rents due to high demand and low supply. Vacancy rates are at their lowest levels since 1985, and rents have risen at an annual rate of 3.5%, the fastest pace in three decades, according to the housing group.

Another part of the problem I’ve written about before: Builders are less interested in constructing medium-prices housing at the moment for numerous economic reasons, preferring mostly high-end construction. This impacts availability of starter homes and rental units.

The National Low Income Housing Coalition says it is using a trust fund to help communities build and rehabilitate affordable rental homes.

“It is also critical to preserve and improve the nation’s public housing stock, expand the number of housing vouchers, and increase funding for other programs providing affordable housing to truly end this crisis,” the report says.

What is the housing wage for your state? You can find out on the map on this page. Remember that your earnings are only one of many things that determine your ability to find housing. Your potential landlord will probably look at a version of your credit report as part of your rental application, and bad credit rating or a history of payment problems could make it harder to find a place to live. A past eviction could be really problematic, as well, though it may not be a deal breaker.
It’s a good idea to review your credit before looking for housing, so you can check it for errors as well as be upfront about anything a landlord may find during a credit review. To keep track of where you stand, you can get a free credit report summary, updated monthly, on Credit.com.

https://bobsullivan.net/restless/heres-the-hourly-rate-you-need-to-afford-a-two-bedroom-apartment-in-every-state-hint-its-a-lot-more-than-7-25hr-or-15hr/

[Sovereign Nation]

Wow. Who knew that it would cost so much to have a place to stay?

Glad I make more than minimum wage and that this doesn't pertain to me.

[GMDino]

(06-07-2016, 10:24 PM)Sovereign Nation Wrote: Wow.  Who knew that it would cost so much to have a place to stay?  

Glad I make more than minimum wage and that this doesn't pertain to me.

[Sovereign Nation]

(06-07-2016, 10:35 PM)GMDino Wrote:

Cool meme.  Also doesn't pertain to me.

[GMDino]

(06-07-2016, 10:41 PM)Sovereign Nation Wrote: Cool meme.  Also doesn't pertain to me.

Thanks for that. ™ 

[StLucieBengal]

I will tell you that those Florida figures are way off.

[GMDino]

(06-07-2016, 11:11 PM)StLucieBengal Wrote: I will tell you that those Florida figures are way off.

Where are you getting your numbers from?

[StLucieBengal]

(06-07-2016, 11:11 PM)GMDino Wrote: Where are you getting your numbers from?

From the MLS

Edit: and I could find cheaper on Craigslist.

[Rotobeast]

(06-07-2016, 08:54 PM)GMDino Wrote: https://bobsullivan.net/restless/heres-the-hourly-rate-you-need-to-afford-a-two-bedroom-apartment-in-every-state-hint-its-a-lot-more-than-7-25hr-or-15hr/

As a landlord I can tell you the biggest reason that rents are increasing (in my area) is the destruction of properties from Section 8/ Metro Housing tenants that have no accountability in the care of the property.
You can take them to court for damages, but they have no money to take.
The uptick in rent is to cover those losses.
There are also municipalities that hold the property owner responsible for a water bill that has went unpaid for several months by a tenant.

[BmorePat87]

That's about right for MD. $1,200 or so for a 2 bed room. For that much, you might as well own.

[Benton]

(06-07-2016, 10:24 PM)Sovereign Nation Wrote: Wow.  Who knew that it would cost so much to have a place to stay?  

Glad I make more than minimum wage and that this doesn't pertain to me.

If you pay taxes, it pertains to you. Much in the same way taxpayers subsidize companies like Wal-Mart by picking up the cost of living for their employees, taxpayers pick up the difference in what landlords charge and what those on lower incomes can afford.

[Rotobeast]

(06-08-2016, 12:53 AM)BmorePat87 Wrote: That's about right for MD. $1,200 or so for a 2 bed room. For that much, you might as well own.

My city (in Ohio) is so depressed that a 2br apt is $4-500.
I only charge $500/month (tack on another $50 for water) for 2 and 3 bedroom houses, although others in my area are at $600+.

[Brownshoe]

I wonder how much that average goes up because expensive area's in big cities. I guarantee if you go slightly outside of the city, or area's inside the city that have cheaper housing the price would be well under the average.

[GMDino]

And what they are showing are averages for the entire state.  So some areas will be cheaper and some more expensive obviously.

[Griever]

im sure these prices would go down if we sent every non white person back to where they belong

#StopWhiteGenocide

but between the wife and i, the only place couldnt live based off this graph was hawaii

[Au165]

(06-08-2016, 01:58 AM)Brownshoe Wrote: I wonder how much that average goes up because expensive area's in big cities. I guarantee if you go slightly outside of the city, or area's inside the city that have cheaper housing the price would be well under the average.

This is the issue with these numbers. My brother lives in Columbus and just graduated from OSU. He was living by campus and his rent was almost the price of my mortgage payment. He moved away from campus and it is now a much more reasonable price. The problem of doing a whole state like this is a few really high cities can drag the whole state average up a couple dollars.

I'm not saying it isn't an issue, but this is one of those times where stats can be made to say what you want them to say.

[GMDino]

(06-08-2016, 09:08 AM)Au165 Wrote: This is the issue with these numbers. My brother lives in Columbus and just graduated from OSU. He was living by campus and his rent was almost the price of my mortgage payment. He moved away from campus and it is now a much more reasonable price. The problem of doing a whole state like this is a few really high cities can drag the whole state average up a couple dollars.

I'm not saying it isn't an issue, but this is one of those times where stats can be made to say what you want them to say.

But those are the areas where the jobs are in most cases.

[BmorePat87]

(06-08-2016, 01:58 AM)Brownshoe Wrote: I wonder how much that average goes up because expensive area's in big cities. I guarantee if you go slightly outside of the city, or area's inside the city that have cheaper housing the price would be well under the average.

The MD average is how much it costs where I live (directly in between DC and Baltimore). This is also where all of the jobs are. 

I could move 60-75 minutes away from this area and the price would drop from 1,200 to maybe 900. 

[Au165]

(06-08-2016, 09:30 AM)GMDino Wrote: But those are the areas where the jobs are in most cases.

You can move outward short distances and see massive drops in housing costs. Back to my example, the are my brother was in was over inflated because of it being close to campus and being pushed up by the demand from the university. By moving 5-10 miles further away he was able to drop his rent by hundreds a month. This isn't just true there it applies in many places, but that was just a recent example I have been dealing with.

[GMDino]

(06-08-2016, 09:41 AM)Au165 Wrote: You can move outward short distances and see massive drops in housing costs. Back to my example, the are my brother was in was over inflated because of it being close to campus and being pushed up by the demand from the university. By moving 5-10 miles further away he was able to drop his rent by hundreds a month. This isn't just true there it applies in many places, but that was just a recent example I have been dealing with.

Then you have more transportation costs.

If you are in an area with bad public transportation then you have to invest in your own.

Right back where you started.