This week the National Low Income Housing Coalition released Out of Reach 2007-2008. The trends that have undermined affordability have continued. “Out of Reach is a side-by-side comparison of wages and rents in every county, Metropolitan Area (MSAs/HMFAs), combined nonmetropolitan area and state in the United States. For each jurisdiction, the report calculates the amount of money a household must earn in order to afford a rental unit at a range of sizes (0, 1, 2, 3, and 4 bedrooms) at the area’s Fair Market Rent (FMR), based on the generally accepted affordability standard of paying no more than 30% of income for housing costs. From these calculations the hourly wage a worker must earn to afford the FMR for a two-bedroom home is derived. This figure is the Housing Wage.”
To view the rankings of most expensive housing wage click here.
For an overview on how to use the data click here.
This is the overview from the report on New Jersey.
New Jersey is the sixth most expensive place for renters! In New Jersey, the Fair Market Rent (FMR) for a two-bedroom apartment is $1,157. In order to afford this level of rent and utilities, without paying more than 30% of income on housing, a household must earn $3,857 monthly or $46,287 annually. Assuming a 40-hour work week, 52 weeks per year, this level of income translates into a Housing Wage of $22.25.
In New Jersey, a minimum wage worker earns an hourly wage of $7.15. In order to afford the FMR for a two-bedroom apartment, a minimum wage earner must work 124 hours per week, 52 weeks per year. Or, a household must include 3.1 minimum wage earner(s) working 40 hours per week year-round in order to make the two bedroom FMR affordable.
In New Jersey, the estimated mean (average) wage for a renter is $16.45 an hour. In order to afford the FMR for a two-bedroom apartment at this wage, a renter must work 54 hours per week, 52 weeks per year. Or, working 40 hours per week year-round, a household must include 1.4 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 $668 in New Jersey. If SSI represents an individual’s sole source of income, $200 in monthly rent is affordable, while the FMR for a one-bedroom is $994.