Study shows costs are not going down, lowest-income tenants hurt worst
(Source: Associated Press)
For homebuyers, affordability is the best it’s been for decades, but for millions of renters coast to coast affordability is still getting worse, according to a study released Tuesday.
As the recession forces more Americans out of work, working-class tenants are bearing the brunt of the cuts. Record foreclosures, at the same time, mean more people are competing for low-cost rentals. And rents in many expensive cities still haven’t budged because so few apartments were built in recent years.
A renter needs to earn $17.84 an hour to cover the monthly rent on the average $928 two-bedroom apartment, if they don’t want to spend more than 30 percent of their income on housing. But the median hourly wage for an American renter is $14.69, more than $3 short of what’s needed, according to the study by the National Low Income Housing Coalition.
The lowest-income renters stand to get hit hardest. The unemployment rate is at a 25-year high of 8.5 percent, but that percentage was even higher — 12.6 percent — for those without a high school degree. Some of the worst layoffs have come from industries that employ low-income workers like construction, retail and manufacturing.
Families displaced by foreclosures are also flooding the apartment market, increasing competition for affordable rentals.
And while rents are falling in some individual markets, many cities are showing little signs of softness because demand for apartments remains high. Renters in Seattle, Los Angeles, San Francisco and Portland, Ore., all traditionally strong markets, won’t see many rent cuts.
Even renters in beleaguered apartment markets like Phoenix, Atlanta, Las Vegas and Florida likely won’t enjoy the deals in their areas because the local economies are reeling.
Read the full article “Despite housing downturn, renters get no relief” from MSNBC.com (April 14, 2009).