#107 Sep/Oct 1999

Millions of Working Americans Still Lack Affordable Housing

Despite the booming economy, affordable rental housing is unavailable to millions of working Americans, concludes the National Low Income Housing Coalition (NLIHC) in its annual Out of Reach report on […]

Despite the booming economy, affordable rental housing is unavailable to millions of working Americans, concludes the National Low Income Housing Coalition (NLIHC) in its annual Out of Reach report on income and rental housing costs.

The analysis shows that in no local jurisdiction in the U.S. can a full time minimum-wage worker afford the Fair Market Rent (FMR) for a one-bedroom unit in their community, and in 70 metropolitan areas minimum wage workers must work more than 100 hours a week to afford FMR in their area. In nearly every county in the U.S., at least one out of three renters earning the median renter income for their area cannot afford FMR.

In order to afford the median FMR of a two-bedroom rental unit in the U.S., a worker would have to earn a wage of $11.08 per hour, 215% of the current federal minimum wage of $5.15 per hour. A worker earning minimum wage would have to work the equivalent of 86 hours per week in order to afford the median FMR for a two-bedroom rental unit.

In some areas of the country, housing is even less affordable to low-wage workers. The wage necessary to afford a two-bedroom unit in San Francisco is $22.44, and at the minimum wage, a household must generate 174 hours of work per week to afford the median rent. In Westchester County, NY, those numbers are $20.63 and 160 hours, respectively.

NLIHC also examined TANF and SSI income assistance, and found they fall far short of providing enough income for rental costs. The basic SSI monthly benefit of $484 leaves a renter with just $21 per month for food, clothing, and other basic necessities. TANF benefits are even less.

“In the midst of unprecedented economic prosperity, the continuing gap between housing costs and income is unacceptable,” said NLIHC President Sheila Crowley. “The widening distance between the rich and the poor is making life harder for the poor, with rents rising faster than wages, precisely because of the growing economy.”

“The proposed budget Congress is now debating will provide tax cuts to the wealthy, and decrease aid to those who most need housing subsidies,” said Crowley. “At the very least, something must be done to the raise the floor.”

“Economic justice in the workplace means, among other things, guaranteeing a living wage to working people,” said Steve Coyle, CEO of the AFL-CIO Housing Investment Trust, in the introduction to Out of Reach. “Social justice in our nation includes providing the means for all people to live in decent, affordable housing.” Speakers at the press conference releasing Out of Reach, including Senators Edward M. Kennedy (D-MA) and John Kerry (D-MA), stressed the importance of both increasing funds to HUD for housing subsidies and increasing the minimum wage.

The research, led by Cushing N. Dolbeare, veteran housing expert and chair emeritus of NLIHC, estimates the affordability of the FMRs established annually by HUD. FMRs are used for the Section 8 rental housing certificate and voucher programs. They are HUD’s best estimates, based on telephone surveys and other data, of gross rents (including utilities) of “privately owned, decent, safe, and sanitary rental housing of a modest (non-luxury) nature with suitable amenities” in fiscal year 1999. The report defines affordable housing by the generally accepted standard of costing no more than 30 percent of income.

Out of Reach: The Gap Between Housing Costs and Income of Poor People in the United States is available from NLIHC, 202-662-1530, and online at www.nlihc.org/oor99/.


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