Rent Out of Reach for Many Low- and Middle-Income Workers

David Deem

Commentary by Desirée Patno

It's difficult for low-income renters throughout the country to afford a modest one- or two-bedroom rental home, according to findings from the National Low Income Housing Coalition's (NLIHC) Out of Reach 2019 report. The national housing wage, or the hourly pay rate a worker would need to afford a rental home, is $22.96 for an average two-bedroom rental home and $18.65 for a one-bedroom.

The federal minimum wage is $7.25 per hour, which means that a worker earning minimum wage would need to work 127 hours per week, which would equate to having three full-time jobs, in order to afford a two-bedroom rental home. To afford a one-bedroom rental home, a minimum-wage worker would need to work 103 hours per week.

There are currently only 4 million rental homes that are affordable and available to the nation's 11 million extremely low-income renter households below the poverty rate, leaving a shortage of 7 million homes. A family of four below the poverty rate earns no more than $25,750 a year, which means they can only afford $644 a month in rent. This family would be short $550 in affording an average two-bedroom rental home and $326 short in affording a less ideal one-bedroom rental home.

Families below the poverty line and minimum-wage workers aren't the only ones struggling to afford rental housing. The average renter's hourly wage is $5.39 less than the national two-bedroom housing wage and $1.08 less than the one-bedroom housing wage. Shockingly, a full-time worker earning an average wage could afford a two-bedroom rental home in only 10 percent of counties in the entire United States.

The most expensive two-bedroom rental housing wages are found in coastal states on the West and East Coasts. Full-time workers in the following states need to make over $25 per hour to afford a two-bedroom rental home:

  • California
  • New York
  • Colorado
  • Alaska
  • Hawaii
  • Connecticut
  • Massachusetts
  • New Jersey
  • Maryland
  • Washington, D.C. 

Women face greater challenges affording rent because they, on average, earn less than their male counterparts. Recent Census Bureau data reveals that women earn about 80 cents for every dollar a man earns, or 25 percent less than men. A median-wage, full-time male worker can afford a modest one-bedroom apartment at the national fair market rent, but a female median-wage worker cannot.

This gender disparity in wages and housing affordability adversely affects children, since children that don't live with both parents are likely to live with their mother. When a mother has difficulty affording rent, this can negatively affect a child's health and cognitive development, as the parent isn't likely to have additional income to spend on other necessities.

Rent affordability is a pervasive issue in the nation's economy. It's in our best interest to develop affordable housing for citizens so they can attain jobs, earn money for short-term and long-term financial wealth and contribute to the economy at the state and national level.



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