Rent Unaffordable for Average Worker in New York

By PATRICK LUCE (Patch Staff) and Brian McCready (Patch Staff)

While the economy has improved and the unemployment rate has dropped in most states across the country, many people are still struggling to pay the bills, especially when it comes to rental housing, a National Low Income Housing Coalition study shows.

The problem is that while jobs have increased, wages have not, forcing roughly 21 million working Americans to scrape by on a near minimum wage salary, according to the Pew Research Center.

At the same time, rents keep rising because the demand for rental units has increased across the country as the home ownership rate has dropped to its lowest point since 1989.

The result is that people are being priced out of the rental market, and it’s worse in New York than most parts of the country, according to The Atlantic’s City Lab.

Most economists advise renters to pay no more than 30 percent of their annual income on housing. Anything more is unaffordable. Nationally, the average worker needs to make $19.35 an hour to afford the rent on an average two-bedroom home, about $4 an hour more than the average renter’s income of $15.16.

In New York state, a renter needs to make $25.67 an hour to afford a two-bedroom apartment. That’s $3.46 an hour more than the average New York renter makes, the study has found. Hawaii tops the list with a whopping $17.12 wage/rental gap.

It gets worse for people in New York working for near minimum wage. Those toward the bottom of the income scale in New York must work 98 hours a week to afford just a one-bedroom apartment in the state, one of the highest totals in the country.

• In Putnam County, where only 17 percent of households are rentals, fair market rent for a 1-bedroom is $1,249, according to the study, and someone would have to make $24.02 an hour to afford that.
• Ditto in Rockland County, where 30 percent of households are rentals, according to the study.
• In Westchester County, where 38 percent of households are renters, the fair-market rent for a one-bedroom is $1,292 and to afford that rent a worker would need to make $24.85 an hour to afford it.

Hawaii (125 hours) is the only state worse than New York. A two-bedroom home requires renters at minimum to work more than 117 hours a week.

The problem continues to grow as potential homeowners are increasingly priced out of the market, instead turning to rentals, further limiting the rental stock and driving prices higher.

“The tightening rental market has the most significant impact on low income renters,” the report concludes. “Many higher and middle income renters occupy units that are affordable to lower income groups, reducing the supply of affordable and available decent apartments for the lowest income renters. As a result, for every 100 extremely low income (ELI) renter households, there were just 31 affordable and available units.”