Originally Published: October 5, 2001 5 p.m.
The gap between what the poorest Americans earn and what they must pay in rent is widening, according to a recent report.
The annual "Out of Reach" report, released by the National Low Income Housing Coalition at a press conference this week in Washington, D.C., says that the average American must earn $13.87 per hour – 269 percent of the federal minimum wage ($5.15 per hour) – to rent a two-bedroom apartment or house.
Last year, that figure was $12.47 per hour, or 242 percent of the minimum wage.
Locally, the disparity between income and rent is not nearly as pronounced as it is in other communities, such as San Francisco or Boston.
In Yavapai County, where the median family income is about $36,800, workers must make nearly $8 per hour to afford the median fair market rent for a one-bedroom apartment; $10.57 per hour for a two-bedroom unit; or about $15 per hour for a three-bedroom place.
According to the Governor's Office of Housing Development in Phoenix, median fair market rents in Yavapai County range from $416 per month for a one-bedroom unit to $854 per month for four bedrooms.
Median fair market rent reflects the midway point of rents, meaning that exactly half of all rentals cost more than that figure, and half cost less. Affordable housing – by definition – should not account for more than 30 percent of a person's gross annual income.
While the national median rent for a two-bedroom unit is more than double the minimum wage, it is slightly lower than the nation's median paycheck of $16.97 per hour.
According to the "Out of Reach" report, fair market rent is more than twice the prevailing minimum wage in 33 states and 1,237 cities and counties. Although the federal minimum wage has remained at $5.15 per hour since 1997, rents have risen significantly. Today, a worker earning minimum wage would have to work 108 hours per week to afford the national median fair market rent for a two-bedroom apartment, the report says.
In San Francisco, workers must earn $33.60 per hour to afford a two-bedroom place, and in Boston, they must earn $20.21 per hour.
The gap between income and housing costs is much wider for elderly and disabled people who depend on Supplemental Security Income (SSI) as their primary source of income.
In Florida, an SSI recipient receiving $512 each month can afford a monthly rent of no more than $154, while the fair market rent for a one-bedroom home in the Sunshine State is $566 per month.
"Today's affordable housing crisis is the result of both market failure and government disinvestment in housing assistance for low income families," said Sen. Jack Reed, D-R.I., who is chairman of the Housing and Transportation Subcommittee of the Senate Banking Committee.
He commended the National Low Income Housing Coalition for publishing its annual "Out of Reach" report and for working to keep the nation's affordable housing problem "in the public eye."
"Our annual 'Out of Reach' reports have drawn a stark picture of housing affordability in America today," said Sheila Crowley, president of the National Low Income Housing Coalition. "Sound and affordable housing is the key to improving the lives of millions of people."
To get a copy of the entire report, call the coalition at (202) 662-1530, or download it from its Web site at www.nlihc.org.