Out of Reach: Rental costs on the rise, income not keeping pace (w/databases)
Angi Carter, Community Media Lab
A Connecticut worker needs to earn $23.58 an hour to afford rent for a modest 2-bedroom apartment in the state, according to a national report issued jointly today by the Connecticut Housing Coalition and the National Low Income Housing Coalition.
The housing affordability report, "Out of Reach 2012: America's Forgotten Housing Crisis" is disseminated annually with updated calculations for the "housing wage" in every county, metropolitan area and non-metro area in the United States.
Housing wage is a term coined by the creators of this report and means the amount a person must earn to afford a typical 2-bedroom apartment without spending more than 30% of total household income on housing costs.
Connecticut's housing wage for 2012 is the seventh-highest in the nation and above the national housing wage for this year at $18.25 per hour. The average renter in the U.S. earns $14.15 an hour, compared to the average wage of $15.81 for a renter in Connecticut.
Last year, the statewide wage was slightly lower at $23.37 per hour.
Fair market rents rose as well. In 2011, the fair market rent for a two-bedroom apartment was $1,215 per month. This year, Out of Reach reports $1,226 per month.
Use this database to view the housing wage and fair market rent for Connecticut's metro areas, as well as Litchfield and Windham counties:
Crum said Malloy's proposal to add more than $330 million to renovate and create "affordable, supportive and congregate housing" is "precisely the right response at this time."
Megan Bolton, senior research analyst for NLIHC, said in 86% of U.S. cities, the housing wage exceeds the average hourly wage earned by renters. "More and more people are choosing to rent rather than own," she said, adding that as rental housing demand drives down the number of vacant units, rent prices rise.
In response to a Register inquiry, Raphael Bostic, assistant secretary for policy development and research for the U.S. Department of Housing and Urban Development (HUD) said the annual 'Out of Reach' report helps to provide a foundation for budget decisions and policy initiatives by HUD, such as then National Housing Trust Fund.
NLIHC is making a policy recommendation related to the tax code. Once the next Congress and president address tax reform, the coalition will advocate for changes to the mortgage interest deduction, according to Sheila Crowley, president and CEO of NLIHC.
Depending on any changes made, adjusting tax policies for the deduction could save the federal government up to approximately $100 billion a year, she said. "It's very expensive and regressive," Crowley said. "That (savings) should remain in housing and not go to deficit reduction...That's not easy to do."
What policy recommendations would you make to state and federal officials for making housing more affordable? Please leave your comments below or email us at email@example.com or send a tweet to @nhrvoices.