February 27, 2012 3:52 am
“Working households” are defined as those with a household income of no more than 120 percent of the area median income in which the household members worked an average of at least 20 hours per week for the preceding 12 months. Housing cost burden for working households grew over the two-year period studied largely due to falling incomes and rising rental housing costs. Report author Laura Williams says rents rose due to increased demand for rental housing, which has outstripped supply, partly due to the crisis on the homeownership side of the market.
For working homeowners over the same two-year period, incomes slid more than twice as much as housing costs. In fact, incomes for working homeowners fell even more sharply than they did for working renters. Additionally, the housing costs of most working homeowners are still tied to homes bought before the sharp drop in home prices and thus do not reflect today’s lower home purchase prices.
Following, are several key national findings from the report:
- Nearly one in four working households spends more than half of its income on housing. The share of working households with a severe housing cost burden increased significantly between 2008 and 2010, rising from 21.8 percent to 23.6 percent.
- Despite falling home prices and values, housing affordability worsened for working homeowners. Median housing costs for working homeowners declined modestly between 2008 and 2010. Meanwhile, the incomes of working homeowners declined even more, driven in large part by a decrease in the median number of hours worked per week between 2008 and 2010.
- Working renters fared even worse, with both increased rents and decreased incomes between 2008 and 2010. While incomes increased somewhat between 2009 and 2010, over the two-year period renters saw a four percent decline in household income. The housing costs of renters rose over the two-year period by four percent.
- California - 34 percent
- Florida - 33 percent
- New Jersey - 32 percent
- Hawaii - 30 percent
- Nevada - 29 percent
- Miami-Fort Lauderdale-Pompano Beach, Fla. - 43 percent
- Los Angeles-Long Beach-Santa Ana, Calif. - 38 percent
- San Diego-Carlsbad-San Marcos, Calif. - 37 percent
- Riverside-San Bernardino-Ontario, Calif. - 35 percent
- New York-Northern New Jersey-Long Island, N.Y.-N.J.-Pa. - 35 percent
Published with permission from RISMedia.