The Hourly Income You Need To Afford Rent Around The U.S.
Full-time workers who make minimum wage can’t afford a two-bedroom rental home in any state in the U.S. without spending more than the recommended 30 percent of their income, according to a report from the National Low Income Housing Coalition.
The group’s annual “Out of Reach” report compares minimum wages and housing costs in states, metropolitan areas and counties across the country. This year’s results show the hourly wage rate needed for a “modest” two-bedroom rental in 2020 is more than double the federal minimum wage of $7.25 per hour in all but one state and Puerto Rico.
Arkansas has the lowest hourly income needed for a two-bedroom rental at $14.19, while the state minimum wage is $10.00, the report said. Hawaii demands the highest income of renters: Workers need to make $38.76 to rent a two-bedroom there, and the state minimum wage is just $10.10.
At federal minimum wage, the average American worker would need to log 97-hour weeks for 52 weeks per year to afford a two-bedroom apartment or rental home, according to the report. For the overwhelming majority, not even sharing a dual income with a federal minimum wage-earning partner would cover a two-bedroom rental in their state.
It’s a grim outlook similar to the group’s previous reports, which also showed sobering disparities between income and rent. The report’s authors say poor political decisions are to blame, as well as the coronavirus pandemic, which has only compounded the problem.
“Housing is a basic human need, but millions of people in America cannot afford a safe, stable home,” stated NLIHC President and CEO Diane Yentel in a press release. “The harm of this enduring challenge is laid bare during the COVID-19 pandemic, when millions of people in America risk losing their homes. The lack of affordable homes for the lowest-income people is one of our country’s most urgent and solvable challenges, during and after COVID-19; we lack only the political will to fund the solutions at the scale necessary. It’s time for Congress to act.”
Minimum wage hasn’t kept up with inflation: In 1968, the federal minimum wage was equivalent to $12.13 in 2020 dollars ― nearly $5 higher than today’s actual federal minimum wage.
See the full report for more details.