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ProJo: Report affirms gap between what R.I. renters earn and cost of housing

 

“Simply put, we need to be doing more for the residents of Rhode Island,” said Caitlin Frumerie, executive director of the Rhode Island Coalition for the Homeless. “There is no excuse for people to be living in poverty and deciding between paying rent and putting food on the table.”


PROVIDENCE, R.I. -- The gap continues between Rhode Island wages and apartment rental costs, and Rhode Island is the 19th-highest-cost rental market in the country, according to the new “Out of Reach” report from the National Low Income Housing Coalition.

About 40 percent of Rhode Islanders rent their homes, and the state has 165,492 renter households. Providence is an especially tight rental market. The vacancy rate was 3.7 percent in the Providence metro region, according to the latest regional report by the U.S. Department of Housing and Urban Development. Last year, the national vacancy rate was 7.2 percent.

The “Out of Reach” report, released Wednesday, is produced every year by the coalition, a housing advocacy group based in Washington, D.C. It tracks the gap between what renters earn and what it costs to afford a home at Fair Market Rent, which is established by HUD for different areas. Brenda Clement, executive director of HousingWorks RI at Roger Williams University, recently completed a nine-year term on the coalition’s board, serving as chair for the last three years.

“The cost burden for renters in Rhode Island increased 38 percent from 2000 to 2015, with 51 percent of renters paying more than 30 percent of their income to their housing costs,” Clement noted. “When an individual is housing cost burdened, it prevents them from being able to save money, purchase a home, or invest in education. Low income, cost burdened renters in particular often struggle to meet basic needs.”

“Simply put, we need to be doing more for the residents of Rhode Island,” said Caitlin Frumerie, executive director of the Rhode Island Coalition for the Homeless. “There is no excuse for people to be living in poverty and deciding between paying rent and putting food on the table.”

Every New England state ranked in the top 25 for rental housing unaffordability: Massachusetts (6th), Connecticut (9th), Vermont (13th), New Hampshire (14th), and Maine (23rd). Hawaii has the highest rental costs in the country, and Puerto Rico the lowest, the report found.

In Rhode Island, the Fair Market Rent for a two-bedroom apartment is $1,038, up from $1,013 in 2017. To afford this cost for rent and utilities – without paying more than 30 percent of income on housing – a household must earn $3,461 monthly or $41,526 annually. This translates into a “housing wage”of $19.96 per hour, up from $19.49 in 2017.

But in Rhode Island, the estimated average wage for a renter is $13.70, up from $13.27 in 2017. A minimum wage worker earns just $10.10 an hour, up from $9.60 in 2017.

This means a minimum wage earner would have to work 79 hours per week to afford a two-bedroom apartment at Fair Market Rent, or, a household would need two minimum wage earners working 40 hours per week year-round.

According to the Rhode Island Department of Labor and Training’s reports, only 3 of the 10 fastest growing occupations in Rhode Island currently pay a wage that exceeds the “housing wage.”

Those who rely on Supplemental Security Income can afford to spend no more than $250 a month on rent, yet the national average monthly rent for a one-bedroom rental home is $931.

Three out of four low-income households in need are denied federal housing assistance thanks to chronic underfunding. The net result is a national shortage of 7.2 million affordable rental homes. No state or major metropolitan area has an adequate supply, the report found.

“We need our state elected officials to demonstrate bold leadership by investing more state resources in affordable housing, not less, to ensure that all Rhode Islanders have a safe, decent place they can afford to call home,” said Melina Lodge, executive director of the Housing Network of RI. The Housing Network is the professional association of the state’s non-profit housing developers.

Courtesy of Providence Journal