Unaffordable Housing Report

A report on housingconditions for individuals and families ineligible for federal assistance marks an evolving trend in housing for Americans.

Rents, in summary, are rising while the income of some Americans is stagnant, causing a wide gap between what is affordable and available.

Low income, unassisted households often face housing instability, threats of eviction, poor housing conditions and homelessness, said the National Coalition for Low Income Housing, which issued the report.

The report, entitled Out of Reach 2013, is based on data from the Dept. of Housing and Urban Development, the U.S. Census Bureau, the Bureau of Labor Statistics, the Department of Labor, and the Social Security Administration.

Affordability in this report is consistent with the federal standard that no more than 30 percent of a household’s gross income should be spent on gross housing costs, the Coalition said. Households paying over 30 percent of their income are considered cost burdened. Households paying over 50 percent of their income are considered severely cost burdened.

In 2011, the latest year for which data are available, 35 percent of all households, 40.7 million, rent their homes.

Tight credit and stricter standards for buying a home have forced many age groups to consider renting.

After the financial collapse of Wall Street in 2008, the average vacancy rate was 8 percent nationwide for apartments.

By the fourth quarter of 2012, the vacancy rate was 4.5 percent, giving landlords the leverage to raise rents. 

Although 29 percent of renter households live below poverty,8 and a quarter of renters have extremely low incomes,9 most newly constructed units are for high income households, while older units are being swiftly upgraded to serve a higher income market, the report said.

In Virginia, the Fair Market Rent (FMR) for a two-bedroom apartment is $1,078. In order to afford this level of rent and utilities – without paying more than 30 percent of income on housing – a household must earn $3,592 monthly or $43,108 annually, the report said.

In Virginia, a minimum wage worker earns an hourly wage of $7.25 and the estimated mean (average) wage for a renter is $15.79.

Virginia is ranked 10 among 50 states as the most expensive places to rent an apartment. 

To afford a two-bedroom apartment in Virginia, one must earn at least $20.72 an hour, the report said.

But our region is even more expensive than Virginia as a whole and more expensive than the nationwide average hourly wage of $14.72, well below the $18.79 an hour necessary to rent.

To afford a two-bedroom apartment in Tidewater, one must earn $21.85 an hour, the report said.

The fair market rent for a two-bedroom apartment in Tidewater is $1,136 a month. To afford the apartment, one must earn at least $45,500 a year in base salary.