8
High rents, low income
It’s becoming harder, especially in certain cities, for low-income people to find affordable rental housing.
To view this content, Javascript must be enabled and Adobe Flash Player must be installed.
Celixia Rodriguez used to spend more than 60 percent of her income on rent. She makes about $10 an hour cleaning houses in Boston and picks up any side work she can.
“Even if I had five part time jobs, at $10 an hour it’s hard to come up with $1,500 a month and still support your children and fill your gas tank,” she says.
For three years, Rodriguez and her two kids doubled up, sharing a three-bedroom apartment in Boston with her sister and her two kids. Now she’s moved to the suburbs and her rent is subsidized by the local nonprofit, Neighborhood Housing Services of the South Shore. Her rent is now a much more manageable 30 percent of her income.
Over a quarter of renter households paid over half their income to rent in 2010, says Eric Belsky, managing director of the Joint Center for Housing Studies at Harvard University. That’s up from 20 percent in 2000.
“And we know that that’s a risk for homelessness, because you just have so little left over for basic necessitie,s and you are unable to save for emergencies,” says Megan Bolton, the research director at the National Low Income Housing Coalition, which released a report looking on rents and wages this week.
The study estimates that workers would need to make $18.79 an hour in order to keep rent from eating up more than 30 pecent of their income. Yet the average renter actually only makes an hourly wage of $14.32.
That often means sacrificing on money for food, health care, travel, and other expenses.
It also means the economic impact can spread from the renter to the communities they live in, says Harvard’s Belsky.
“They’re spending less on things in the local economy,” he says. “There’s no question, from nothing comes nothing.”
Moreover, some renters are forced out of pricey cities because they can’t afford the rents at all.
“Families are deliberately, and in many cases systematically, moving outside of some of the high-cost cities across the country,” says Brett Theodos, a senior research associate in the Urban Institute’s Metropolitan Housing and Communities Policy Center. “What we’re losing there is some of the fabric of social life in cities.”
See how many hours a week a minimum wage worker would have to clock just to keep rent around 30 percent of their income. Map from The National Low Income Housing Coalition. (Click to enlarge PDF)
Sadly too many employers use the minimum wage as the prevailing wage, particularly in "Right to Work" states. The minimum wage should be for only entry level workers and the minimally capable workers. We need to find some means of pushing employers to give pay raises commensurate with performance. The free market is not working at this level. These employers have the "Any monkey can do this job" mentality, and will continue to pay the lowest wage possible to fill their positions, all the while complaining about the quality of help available. This is what lead me to move from Arkansas to Alaska. While raising the minimum wage seems like a good idea, and I will support it. Those workers who are just above the minimum get hurt each time we move the minimum up. The worker (I was one of them) proves himself and finally gets raises to $1.50 to $3.00 above the minimum wage then by the stroke of a pen the bottom raises up to catch him once again. Most employers do not give raises to other workers when there is an increase in the minimum wage. We need some means of encouraging employers to offer a fair wage for good workers. What we have does not work.
As far as building their own houses and doing subsistence living, these are not options for very many, and there is no retirement or medical care available for subsistence families. This is part of how Roosevelt brought about the surge in the U.S. economy, it was not just the war budget or the elimination of workers through the war deaths it was also the death of subsistence living for the masses. Taxes could not easily be levied against a bunch of hillbillies growing gardens and hunting for game, but once they had jobs the income tax fortified the treasury.
Can someone start a non-profit credit union that does nothing but build, own and manage apartment complexes?
Maybe they could lower apartment rents, keep the speculators from jacking up rents on houses that they bought in forclosure, and keep us from having another housing bubble.
If they were open with their books and they had free checking, I would move my money in a heartbeat.
Instead of working 80 hours per week people should try to grow their own food, build their own homes etc. To earn $10 per hour and then spend $20 on something which came out of machine in 10 seconds ...
Indrek
www.gloghome.com
IndrekK,
It is easy to say that all inner-city workers should just live a subsistence lifestyle , the truth is that few are cut out for it. A little container gardening aside to help with food costs and quality of produce, a greater use of pantry staple products for real home cooking all helps with the food side of the budget but for rent most are trapped in their environment. Your suggestion is not helpful and could be hurtful since it puts an un-fair burden on a highly stressed population. I lived the subsistence life on a farm in Arkansas and had no savings to speak of and absolutely no health care plan other than don't get hurt or sick. There is no retirement plan for subsistence living, you work until you die, and that may mean that you die young.
Good workers should be able to get good pay.
When I was earning minimum wage, I wasn't living at home meaning I WAS paying for an apartment, so I don't find this story nutty at all.
Even a basic efficiency ("studio") apartment cost me most of my income and I discovered the joys of bare-bones prices for everything else, from day-old bread and near-expiration milk to high-deductible insurance for my car. The wages were meager and insanely low; despite working 80 hours a week I barely could afford a basic existence, forget any hopes of saving money for a house.
The rush of venture capitalism into the foreclosed-housing market surprises me not the least. Where there's an element of our economy in distress, just like the vultures they are, you can expect to see these opportunists milk every last dime they can from an economic morass they were instrumental in creating.
Hey, for them it's just another "win-win."
This is kind of a nutty story. When I was earning minimum wage I was living in a my bedroom at my folks house. I wouldn't have dreamed of trying to rent an apartment. These kinds of jobs are for kids living at home while they're learning the skills they'd need for a REAL job.
Anyway rents will adjust to people's incomes, they have no choice, the alternative is vacancies.
