[This post is a press release issued by Katie Fritz, Policy and Program Manager at CEDAM.]
Lansing, MI – Working at the $7.40 minimum wage in Michigan, a family must have 1.9 wage earners working full-time – or one full-time earner working 77 hours per week – to afford a modest two-bedroom apartment.
This is according to a national report, Out of Reach 2011, that was jointly released this week by the National Low Income Housing Coalition (NLIHC), a Washington, D.C.-based housing policy organization, and the Community Economic Development Association of Michigan (CEDAM). The report provides the Housing Wage and other housing affordability data for every state, metropolitan area, combined non-metropolitan area, and county in the country.
The current Housing Wage for Michigan is $14.32. The Housing Wage is the hourly wage a family must earn – working 40 hours a week, 52 weeks a year – to be able to afford the rent and utilities for a safe and modest home in the private housing market. Michigan’s Housing Wage has increased 27% since 2000.
The typical renter in Michigan earns $10.95, which is $3.37 less than the hourly wage needed to afford a modest unit. As a result, an estimated 59% of renters in Michigan do not earn enough to afford a two-bedroom unit at the Fair Market Rent.
“Despite the decline in the housing market, fair market rents have increased in the last decade,” said Jamie Schriner-Hooper, Executive Director of CEDAM. “As we work to rebuild the economy, we need to ensure that low- and moderate-income workers can afford to live in our communities.”
The gap between wages and rent is especially important given Michigan’s high foreclosure rate. “Homeownership is more financially accessible today, but only to those families with good credit,” explained Schriner-Hooper. “After a foreclosure, households need safe, decent, affordable rental housing options while they get back on their feet.”
This year, Michigan is the 30th most expensive state in the nation for renters, more expensive than Ohio and Indiana and similar to Wisconsin. The National Housing Wage is $18.46 in 2011.
Additional Facts about Michigan:
- From 2005-2009, 25% of Michigan households rented their homes. Today that percentage is expected to be higher due to foreclosures and the tighter credit market.
- Rent and utilities for a modest two-bedroom apartment cost more than $800 in eight Michigan counties: Grand Traverse, Wayne, Lapeer, St. Clair, Macomb, Oakland, Washtenaw and Livingston. To afford this, minimum-wage earners need to work over 80 hours per week.
- In the 37 least expensive counties, fair market rent for a 2BR apartment is $595. However, in several of those counties the average renter can only afford half that amount.
- To find out what your personal housing wage is (how much you need to earn per hour to afford your rent and utilities), visit http://nlihc.org/oor/oor2011/calc.cfm.
For additional information, including data for your area, visit http://www.nlihc.org/oor/oor2010.