The need for affordable rental housing is rising. The foreclosure crisis converted many homeowners into renters and the recession lowered the amount of income that could be spent on such housing. The National Low Income Housing Coalition (NLIHC) released its annual Out of Reach report on the widening gap between income and rent in the U.S. “This year’s Out of Reach report is a reminder that millions of Americans are still waiting for economic recovery, and that a rebound in the stock market is not much help for families who are barely scraping by…People burdened by unaffordable housing have less money for other essential needs like transportation, food, and medicine – leaving too many families facing impossible choices at the end of every month” stated Senator Tim Johnson (D-SD) in the preface of the report.
The report provides data for every state, metropolitan area and county in the country which can be found at http://www.nlihc.org/oor/oor2011/. Delaware is ranked the 14th least affordable state in the nation when comparing the renter wage required to afford a two bedroom unit at the fair market rent calculated by the Department of Housing and Urban Development (HUD).
In Delaware, a household must earn $38,979 annually to afford a two bedroom rental unit at a fair market rent of $974. This translates into an hourly wage of $18.74 (assuming full-time, year-round employment), far above the estimated $14.14 hourly wage for a low income renter in Delaware. In this case, a household renter would have to work 53 hours or 1.3 full-time jobs to afford a two bedroom unit in Delaware. Hawaii has the highest rentals in the nation, requiring an hourly wage of $31.08 in order to afford a two bedroom unit at fair market value of $1,616. The estimated renter wage in Hawaii is only $13.65. A household renter would have to work 91 hours or 2.3 full-time job to be afford such a unit.
Along the same lines, the Harvard Joint Center for Housing Studies released a report last month titled America’s Rental Housing: Meeting Challenges, Building on Opportunities regarding the shrinking supply of affordable rental housing in the U.S. The report found that 10.1 million households spend more than half their income on rental housing.