Rent: How much is too much?
$1500? $2500? $3000? If you’re beginning to feel like your rent taking over your income, chances are you’re one of the 26.4% of renters who are spending more than half of their income on rent. The problem is that according to the National Low Income Coalition (NLIHC), your rent shouldn’t exceed more than 30 percent of your gross income. However, in high cost areas like New York City and Los Angeles, maintaining that standard can prove problematic.
In the Wall Street Journal article, “Is Your Rent Too Damn High?”, writer AnnaMaria Andriotis discovered that New York City, Los Angeles and Washington D.C. were the three highest areas in America with the average rates at nearly $2100 per mont. The cities also have rates that run as much as 218% higher than surrounding major cities.
“Now compare these rents to incomes,” Andriotis said. “In the New York metro area, income fell 4.6% to $52,375, which translates into no more than $1,527 per month. You’d be hard-pressed to find that kind of deal on a studio in Manhattan or a two-bedroom in Brooklyn.”
According to the NLIHC a renter need to make a wage of at least $18.79 per hour in order to afford “decent” living arrangements. However, with the average renter earning $14.32 per hour, the numbers simply don’t add up.
In May 2013, the Central for Housing Policy published a study entitled, “An Annual Look at the Housing Affordability Challenges of America’s Working Households.” The study looks at the disparity of high rental rates against the lack of income to supplement them.
“Spending most of your paycheck on rent means cutting back on other necessities, including health care and even food,” Janet Viveriros, co-author of the study told MSN.com.
To check out how your rent measures up against apartments around you try the Rentometer site for averages in your neighborhood.
Follow Courtney M. Fowler on Twitter @Court_Nation.