Out of Reach 2005

Yesterday, the National Low Income Housing Coalition (NLIHC) released Out of Reach 2005, its annual report calculating the hourly wage that someone must earn - working 40 hours a week, 52 weeks a year - to be able to afford rent and utilities in the private local housing market in every state, metropolitan area and county in the country.

This year’s national Housing Wage is $15.78 an hour, up from $15.37 an hour in 2004. This is more than three times the federal minimum wage, further highlighting the difference between what people earn and what people are expected to pay for housing in the United States.

With FEMA’s hotel/motel subsidy program for hurricane evacuees scheduled to end sometime within the next several weeks, the report highlights the difficulties displaced families, along with millions of other low income families, face in their search for safe housing that they can afford.

“The disparity between what people earn and what even modest rental housing costs grows larger each year,” said Sheila Crowley, President of NLIHC. “This is the housing market in which millions of low wage workers and elderly or disabled people must try to find safe and decent homes. Now tens of thousands of displaced people from the Gulf Coast have joined them in this competition for scarce housing that they can afford. And FEMA wonders why evacuees are still in hotels.”

With a housing-related fuel and utilities increase of more than 13% in the last year responsible for much of the increase in renter housing costs, the situation is grim. For the first time, NLIHC’s data shows that a full-time worker at minimum wage cannot afford a one-bedroom apartment anywhere in country, further illustrating the dire situation that denies many a right to adequate housing.

Out of Reach 2005 calculates the number of full-time wage earners a household needs in order to afford the Fair Market Rent in any area of the country. Nationally, a family with two full-time workers earning federal minimum wage would make just $21,424, significantly less than the $32,822 annually they would need to afford a modest two-bedroom apartment.

Austin-Round Rock, TX

In Austin-Round Rock, TX, the Fair Market Rent (FMR) for a two-bedroom apartment is $804. In order to afford this level of rent and utilities, without paying more than 30% of income on housing, a household must earn $2,680 monthly or $32,160 annually. Assuming a 40-hour work week, 52 weeks per year, this level of income translates into a Housing Wage of $15.46.

In Austin-Round Rock, TX, a minimum wage worker earns an hourly wage of $5.15. In order to afford the FMR for a two-bedroom apartment, a minimum wage earner must work 120 hours per week, 52 weeks per year. Or, a household must include 3.0 minimum wage earner(s) working 40 hours per week year-round in order to make the two bedroom FMR affordable.

In Austin-Round Rock, TX, the estimated mean (average) wage for a renter is $13.92 an hour. In order to afford the FMR for a two-bedroom apartment at this wage, a renter must work 44 hours per week, 52 weeks per year. Or, working 40 hours per week year-round, a household must include 1.1 worker(s) earning the mean renter wage in order to make the two-bedroom FMR affordable.

Monthly Supplemental Security Income (SSI) payments for an individual are $579 in Austin-Round Rock, TX MSA *. If SSI represents an individual's sole source of income, $174 in monthly rent is affordable, while the FMR for a one-bedroom is $658.