Rents too high for low incomes

[Big Kahuna]

Wednesday, December 14, 2005
Rents too high for low incomes

Costs unlikely to go down

By Taryn Plumb TELEGRAM & GAZETTE STAFF

Monick Lopez takes home $360 every week, far from enough for her to afford anything but a tiny, cramped apartment.

Even then, she needs assistance from the Central Massachusetts Housing Alliance to cover her $625 a month rent.

“I’m renting a studio because I can’t afford anything better,” said the 20-year-old single mother who makes $10.75 an hour registering patients for UMass Memorial Medical Center. “I want my daughter to have her own room, her own space, but I can’t provide that for her.”

Ms. Lopez, who makes well over minimum wage at her temporary full-time job, is part of a growing number of people scraping by because of high housing costs.

According to a study released yesterday by the National Low Income Housing Coalition, things aren’t going to improve any time soon — especially in Massachusetts.

The annual report found that housing costs are continually on the rise and have outpaced earnings, in part, because of a 13 percent increase in fuel and utility costs. It’s gotten so bad, in fact, that even a full-time worker making minimum wage can’t afford a one-bedroom apartment anywhere in the country, according to the study.

“This problem is real for us, and we see it every day,” said Grace K. Carmark, executive director of the Central Massachusetts Housing Alliance. The organization offers prevention programs and shelter support for low-income and homeless people. “These numbers confirm what thousands of clients face in their housing situations.”

According to the report, Massachusetts is the third least-affordable state in the nation when it comes to housing costs, behind Hawaii and California.

By those standards, a person living in Worcester County has to earn $16.48 per hour — more than three times the $6.75 Massachusetts minimum wage — to afford a modest two-bedroom apartment. Likewise, the area’s Fair Market Rent, for a two-bedroom apartment is $857, which requires an annual household income of $34,280. (Fair Market Rents are estimates set by the U.S. Department of Housing and Urban Development that include shelter and the cost of utilities.)

If you do the math, a person making minimum wage would have to work 98 hours a week for all 52 weeks of the year to be able to afford the government-set standard.

Those numbers are distressing, considering the 71,735 renter households in Worcester County, according to the report.

“The cost of housing has continued to rise at a rate that outpaces what people can hope to earn,” Ms. Carmark said. “At the same time, the federal and state governments have gutted the subsidy programs that used to make up the gap.”

She pointed to the significant cuts in Massachusetts’ Section 8 housing and Rental Assistance programs. The Central Massachusetts Housing Alliance intends to push for the restoration of such funding.

She also pointed out that if people lack stable housing, they’re more susceptible to health issues and their children are more likely to cause problems at school.

“It’s a huge community problem,” she said. “The math isn’t working for people, and this winter you add the cost of heating. People are really struggling.”

In a conference call for the media yesterday, Sheila Crowley, president and CEO of the National Low Income Housing Coalition, lamented the situation as well, saying that the housing crisis RIVALS THAT OF THE GREAT DEPRESSION.

She also maintained that if government agencies don’t come up with a cohesive plan, the U.S. is going to see an increase in poverty and homelessness.

Ms. Lopez, for her part, hopes she doesn’t end up in either of those categories.

She’s optimistic that she can get a permanent full-time job with UMass, which will provide her with benefits and job security. She also intends to re-enroll at Quinsigamond Community College, where she has put in a year of studies.

Besides that, she does her best to keep positive about the situation.

“My daughter (who will be two in February) gives me the strength of a thousand men,” she said. “Seeing her smile just makes me happy. I’m only going up from here.”

http://www.telegram.com/apps/pbcs.dll/article?AID=/20051214/NEWS/512140408/1116

[Warpy]

1. Old news, it was the same when Clinton was in the White House

Harper's Index came out with that in the late 90s, that there wasn't a single county in the US where a 40 hour week at minimum wage would enable a worker to afford a one bedroom apartment.

Substandard housing (here it's occasionally camper shells on blocks in cheap RV parks) combined with no access to health care combined with poor nutrition....

The US is the cruelest country on the planet.

2. Life would be so much easier with affordable housing n/t

[orpupilofnature57]

3. Bill made the economy Open, not closed and closing!

[Deja Q]

6. Yes, NAFTA, the DMCA, and other things were of great help.

:eyes:

Presidents are figureheads, paid for by the highest dollar. Not the most votes.

[orpupilofnature57]

14. Got me there.

[acmejack]

5. Social justice has never been this Country's strength.

There are some amazingly mean spirited people in charge, even by traditional DC standards.

[baltlib]

8. not trying to argue but...

how can the us be the cruelest nation, we dont have near the poverty of some countries. how many children die in this country every year from hunger and preventable disease vrs the 40,000 thousand that die around the world every day.

and i do think housing has gotten very over priced, in maryland school teachers and civil servants ( cops etc ) can barely afford a house, they consider affordable housing in maryland almost 170 k nowadays or a mortgage of about 1200 a month. they are only building half a million dollar houses and 300 k town houses here.

[newscott]

10. It's a decent point but perhaps we should look at scales.

The poor in this country need to be allowed a certain standard or else they'd be rioting everyday. Plain and simple. It's the give them enough rope model.

How many people are literally enslaved by their credit card bills? How many live one paycheck away from absolute financial ruin, homelessness and potential starvation?

Those in power are smart enough to know that you have to give some small concessions to the people who make your money for you or they'd come and take what you have for themselves.

[Big Kahuna]

12. Between my wife and myself, we make about $30k

She makes $12/hr ($25k/yr) as a Pharmacy Technician. I estimate that I will make about $5k this year working 6 days a week at my small business. Last year, the economy was real bad and the biz lost about $10k, the preceeding 2 years we just about broke even.

Anyway, we're both very hard working people. I really can't imagine working many more hours than we already do.

Our budget breaks down to this..

Monthly income after taxes: $1750 (if we're lucky)

Rent: $ 850
Heat: $ 150 (averaged over 1 year)
Electric: $ 150
Phone + DSL: $ 80
Cable: $ 50
Food: $ 400 (minimum)
Car Insurance $ 60
Gas for car: $ 100
ok.. beer: $ 100
-----------
$1940
As the article says.. "the math is not working out"

We have been surviving the past year by borrowing several hundred dollars from my Mom each month. (who is very suportive and encourages me to stick with my business)

Basically we have constantly felt like we are slowly drowning over the past few years as the landlords, oil companies, and utilities continue to squeeze, squeeze, squeeze.

Sorry if it sounds like whining to some people.

[hfojvt]

30. Nobody is literally enslaved by their credit card bills

With slavery somebody comes into your town with guns, puts you in chains, and beats you if you do not work for your owners. With credit cards people buy needs and wants, and many times spend more than they have and thus get behind and pay even more in interest and fees.

As far as the poor being a mere one paycheck away from disaster, that also seems to be a choice, in many cases. I got a paper route when I was 12, worked that until I was 17 and had about $4000 in the bank when I graduated from HS. That sum was probably largely due to the fact that I had no car and no girlfriend.

A large part of our industry adopted the Henry Ford model, they paid their employees more and it made them more productive and more loyal and reduced turn-over and training costs. Plus, there is the relatively good paying public sector to compete with the private sector.

[julianer]

34. Slavery was replaced with

wage-slavery. Slave owners by corporate owners (of houses, business, land, banks).

We work our whole lives merely to afford somewhere to live. Why is this necessary? What is all this work for? Who benefits from it?

If we stopped working would all the houses disappear?

If we decided to stop doing so much unnecessary work and started building more houses so that everyone had one for free, would the wage-slave owners disappear?

[hfojvt]

37. I must be a corporate owner then

because I, like about 60% of America, own my own house.

Almost everyone in America has much more than "merely a place to live" although the homeless and the neo-homeless do not have even that.

The sociologist E.A. Ross wrote in 1909 that most Americans were working not for bread, but for jam on their bread. So a major reason we do so much unnecessary work is because of all the different kinds of jam we want to buy. Another is our poorly designed socio-economic system, we do not co-operate enough as producers, nor share enough as consumers. Most of us, not me, have our own cars that we use about two hours a day on average. Socially we do alot of work to market jam and finance industry and purchases. Within six block of my home there are two "payday loan" places. Such places must employ hundreds of thousands in this country, people who produce nothing of value, but are engaged in the profitable "service" of ripping off people who cannot manage their money.

Have you read "The Over-worked American" or "Revenge of the Latch-key kids" or "Looking Backward"? Salutary reading.

[julianer]

38. I haven't read those books

but they sound good.

We live in an illusory society where, in order to get things we are told will make us happy, we spend huge chuncks of time doing things we hate. When we get the things, we find we are not happy because there are many other things we don't 'own' yet.

I'll return the book title favour with 'The Ragged Trousered Philanthropists' by Robert Tressell - a story about a group of wage-slaves in the early 20C. This book contains one of the clearest descriptions of a society based on production for need rather than profit - what socialism would/should be like. Marvellous stuff, and funny too.

[niallmac]

11. cruelest nation on earth? Lets see...

We are the most advanced and powerful nation on earth. We have within our power the ability to feed, house and clothe all our needy. We do not.
We have the power to place human rights, education, nutrition ahead of our international trade priorities. We do not.
We have the power to not support fascist governments that happen to protect our international corporations. We do not.
There are many countries that have no democracy or populist government and many of these countries have deplorable rates of
illness, malnutrition and death. To a large extent these countries have not a fraction of the resources we have.
We have the power to heal and nurture millions. We have the power to rain death upon millions. What are we noted for today?
Cruelty needs to be judged in perspective. The reason we have so many enemies needs to be judged with the same perspective.

[julianer]

33. It's generally the same people

responsible for growing poverty in the US and the huge poverty in other countries.

Read the 'Confessions of an Economic Hitman' to find out how the system sucks wealth from the poor countries to mainly US corporations - the same corporations who have been outsourcing and migrating jobs, leading to low wages and poverty in the relatively wealthy western countries.

Welcome to DU by the way!

[Telly Savalas]

18. If more people would say "Merry Christmas" instead of "Happy Holidays"

then maybe they could afford housing.

Duh.

[sniffa]

4. we used to Live in that area

it's a compLete, fucking shithoLe.

it has no pubLic transportation.

most of the peopLe can't afford automobiLes, and even if they couLd, many Lost their right to drive after the nth DUI conviction.

the onLy non-service jobs in the area are maybe 10% of empLoyment.

the highLight of any given day there, is finding a case of cheap beer for $10 (which they carry with one hand, whiLe they steer their bike with the other).

i don't understand how owners can charge what they do out there for rent.

[Big Kahuna]

13. Sniff this!

heh, sorry..

So where is this incredible utopia in which you live? We'll pack our things right away and crash on your couch. :)

[sniffa]

16. quincy

;)

i'd say it's not much better than cLinton... but that's a Lie. my new white trash neighborhood is Light years ahead! and i Live right on the red Line.

so i'm saving $150-200 a week on the gas i used to use to get to my job in boston.

[Big Kahuna]

20. Oh yeah.. Clinton is a few fries short of a Happy Meal.

I live in Barre, which has a little better scenery, a longer commute, but a slightly less level of overall despair and hopelessness than Clinton. I guess I should consider myself fortunate.

[ultraist]

7. What's going on with the people of BLUE LIBERAL MA?

They aren't taking care of their neediest very well by providing affordable housing.

It's going to get worse too, as interest rates go up, rent goes up because fewer buy, thus flood the rental market. High interest rates are good for landlords and but don't make for a renter's market, as we have recently seen.

[Xithras]

9. It's not just MA. You have to make $22 an hour in Ca to afford a 2br apt.

I was watching a discussion on TV about it, and they had several people on who had to work multiple minimum wage jobs just to make their rents. We're the second most unaffordable renters market in the nation.

[ultraist]

15. I believe it.

Housing in CA is outrageously expensive. I read that the average price of a home in CA is 500k. For half a million here, you can get a brand new, beautiful 4500 square foot home.

[benny05]

28. But people are paid a lot less

I tried getting a job at UNC-Chapel Hill, just for a lateral move, but different content. They couldn't pay me more to move there let alone pay the comparable worth of salary I was making somewhere else.

Triangle is not a cheap place to live if you are just moving there, unless you land a 80K plus position if you want a house that is 1900 sq feet or more for a reasonable neighborhood, or want to commute many miles, just like Boston. With interest rates rising, the housing markets will get tighter, thus so will rents.

[NashVegas]

17. Renting, and Ownership, Too

I can't say how pissed off I am about housing being treated as an investment.

No one has to live in a fucking stock certificate.

[ultraist]

19. Huh?

Real estate has always been an investment, whether those who occupied their own homes realized it or not.

The most expensive purchase MOST will make in their lifetime is a home. Should homeowners buy high in a low appreciation area? Or make a wise investment so that their biggest asset appreciates and they have some networth to pass on to their children?

Homes are the biggest vehicle in which one transmits wealth. I'm not just making this stuff up, it is a fact. The biggest inheritance MOST will pass on, is the proceeds from their home.

[Big Kahuna]

21. What a crock of shit

People used to purchase real estate for their families to to LIVE IN, not as a short-term investment. Houses and acres of land that have been in families for generations are being bulldozed to make way for much more profitable McMansions.

[benny05]

29. Agreed

But some homes are restored.

Ultraist knows what s/he is talking about. S/he is versed in the marketplace when it comes to real estate, in my estimation.

[NashVegas]

22. Not So Much Anymore

For people making a low-moderate income and no or little savings, the home they own indeed will likely be their largest vehicle of investment. These people are being pushed out of the market by those who are purchasing for speculative purposes. And these are not the über-mobile who are going to buy a place and flip it five years on.

Anyone beyond that, these days, I'd expect have their long-term investments more tied up in their 401k or other retirement plan / savings. Assuming they haven't borrowed against it, short of a major crash, it should be fairly safe.

The laborers in the first group, who create wealth for those in the second group, have a right to decent, affordable housing.

[ultraist]

25. It's the largest investment for the middle class

Less than half of low income people are home owners compared to about 90% of middle income people.

http://www.bunchecenter.ucla.edu/publications/ResearchReportN2.pdf

Of course, for most Americans, home equity represents the bulk of their overall wealth portfolio

http://www.lariba.com/knowledge-center/articles/us-islamic-financing.htm

Presented at the Harvard University School of Law

Approximately 66% of the residential properties in the United States are owner occupied. They represent about US$7,000 billion in value. In fact, housing is the single biggest investment in the dream of a family; i.e. owning a home. Mortgage payment is the biggest monthly liability of a typical American household.

***

Speculators are only one reason housing prices have gone up. The market was flooded with buyers when predatory lenders made it possible for anyone to buy a house. The secondary mortgage market and low interest rates are more to blame for increased prices than speculators. Home ownership is at an all time high, due to this.

[tlsmith1963]

23. It's Why I Don't Have My Own Place

I make just about as much as that lady, & I can't get my own place at all. I have to live with relatives. It's a major reason why I'm not a Republican. It's disgusting that rich people get richer while so many others have to struggle. You want to talk morals, conservatives? It's immoral to give so much to the rich while others are continually screwed-over!

Tammy

[Pushed To The Left]

26. I'm almost 33 and still living at home!

It's embarrassing, but that's my reality right now. I will be getting a Bachelor's Degree in IT later this year, so hopefully that will help. I work full time in a professional office environment. Years ago, somebody like me would be able to support a family with no problem. In 2005, many of us hard working people can't even support ourselves.

[B Calm]

24. It cost me a days wages to take my family to Red Lobster..

[proud patriot]

27. Big Kahuna please read

In the future please limit your snips of articles
to 4 paragraphs as per the Democratic Underground
rules .

proud patriot Moderator
Democratic Underground

[tavalon]

31. That is terrible

People should be able to make a living wage. It's really sick that Americans think that's okay.

That said, I wonder why people don't often consider communal living. I'm living with two other adults and our child. In a few months we will be moving to Washington to live with the rest of the tribe (we'll be 5 adults and the kiddo). One of us will be staying home to be the fulltime house maintainer (not me. I think she's crazy to take that on but it's her choice) and four of us will be working outside the house. We're going to sock away some money for retirement and then a couple of us will be going back to school. None of that would be possible for any of us if we were living the traditional paradigm.

[Phoebe Loosinhouse]

32. There is probably more communal living going on then people are aware

of because it is one of the only ways to solve the conundrum of stagnant wages that have not begun to keep up with even simple inflation. The minimum wage should be tied to inflation just like Social Security is. And I do not accept the argument that it will put businesses out of business. Businesses accept all the cost factors they cannot control - like utilities going up, cost of transportation going up, supplies going up; they can also adapt to labor going up - AS IT SHOULD!!!

Anyway, I also think that many McMansion people will start taking in borders in the near future as they get downsized and the heating bills for their vaulted ceilings go through the roof. Communities could address housing shortages by being a little more creative with some of their codes and zoning. I have often thought that one model to keep elderly people in their homes would be a greater tolerance of things like garage apartments where someone like a quasi caretaker could live who would be able to check in on the older person, shovel their walk, get their groceries, etc. This person would be happy because they might have a reduced rent in a nice neighborhood for a cozy apartment and do someone else some good at the same time.

[NashVegas]

36. And More Laws Against It

A town near where I live recently enacted an ordinance making it illegal for more than 2 unrelated people to live in one residence. What sucks most about it is that it wasn't enacted out of any snobbish reason, but because it was believed that a specific church group was trying to jimmy the local town board elections, by inviting members from other townships to establish residences in their homes.

[LostinVA]

35. That's why I bought an house

5.5% 30-year fixed, and my house payment is lower than my rent was. Yes, I have a few extra expenses. but it's STILL cheaper than my rent was.

In five years, my rent for a two-bedroom went from $850 to $1275... and our combined family income is barely $54,000.