The DC area statistics.
The general benchmark for what one should spend on monthly rent is considered to be no more than 30 percent of gross monthly pay, but for many people, decent housing demands more of their paycheck. A recent report by the National Low Income Housing Coalition (NLIHC) confirms that fair market housing costs nationwide far exceed what is affordable for minimum-wage earners.
“In no state can a person working full-time at the federal minimum wage afford a one-bedroom apartment at the Fair Market Rent,” according to NLIHC. The study compares data among all 50 states and the greater District of Columbia area.
Predictably, this yawning gap between earnings and the affordability of renting is extremely pronounced in the DC area, where the wage to afford a market-rate, two-bedroom apartment is the second highest in the country, at $31.21 per hour.
The study calculates the market rate for a two bedroom in the DC area as $1,623 a month, based on the Department of Housing and Urban Development’s 2015 fiscal year data. The median hourly wage for DC workers is $26.09, which affords $1,357 for rent each month.
Although much of the data is attributed to the District of Columbia, HUD’s market rate calculations are extrapolated from a wide swath of DC-area data, which includes DC; Calvert, Charles, Frederick, Montgomery, and Prince George’s Counties in Maryland; Arlington, Clarke, Fairfax, Fauquier, Loudoun, Prince William, Spotsylvania, and Stafford Counties in Virginia; and the Virginia cities of Alexandria, Fairfax, Falls Church, Fredericksburg, Manassas, and Manassas Park.
Approximately 58-60 percent of DC residents are renters, and 31 percent of those renters are extremely low-income. DC minimum wage is currently $10.50, over $3 more than federal minimum wage, and will rise to $11.50 as of this July. At current rates, it would take three minimum wage-earners in order to afford a market-rate two bedroom.
Note: HUD calculates DC’s AMI at $108,600; meanwhile, the median renter income is $47,475.
This article originally published at http://dc.urbanturf.com/articles/blog/the_disconnect_between_wages_and_rental_affordability/11280
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