Cost of Rental Housing Can Stretch the Family Budget

The Minimum Wage has been in the news quite a bit lately. Many are urging both states and the federal government to raise the wage, which has been set at $7.25 on a national level since 2009.

There also is something called the “housing wage,” which is determined by calculating the hourly rate a full-time worker needs to earn in order to pay only the recommended 30% of his or her income towards rent. According to the National Low Income Housing Coalition, the housing wage in Tulsa County is currently $14.21 for a 2 bedroom apartment at fair market rent. So, in other words, for a household to afford rent on a 2 bedroom apartment, 2 people would need to be working full-time for at least minimum wage.

The annual income needed to keep housing costs affordable has increased $720 from 2013 to 2014. This increase means a family earning just enough to comfortably afford rent on a 2 bedroom unit in 2013 would need a 2.4% pay raise just to keep up with the rise in housing costs in Tulsa.

Stepping back to look at Oklahoma as a whole,

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Affordability of Rental Housing: A Quick Update for 2013

In May of 2011 our previous blog host, Elizabeth, wrote a couple of posts about the affordability of rental housing. (You can check them out by clicking here and here). I ran across her posts while searching for some background information on housing issues here in Tulsa. The numbers were nearly two years old, so I did a little digging to see what had changed. So far, I can tell you the answer is: not much.

The National Low Income Housing Coalition (NLIHC) recommends households spend no more than 30% of their income on housing. To calculate what is called the “housing wage” researchers take a person working full-time, and then calculate the hourly rate he or she would need in order to pay only 30% of their income towards rent.

The numbers have changed only slightly over the past two years.  In 2011, the NLIHC stated the annual income needed to afford a 2 bedroom unit at fair market rent in Tulsa was $28,440. For 2013, the NLIHC lists that figure at $28,840, an increase of $400 annually. (Click here for the Oklahoma Data .pdf) This means households in the Tulsa Metro Area require either a single renter earning at least $13.87 an hour to afford a two-bedroom apartment at FMR, or basically 2 adults working full-time at minimum wage.

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