Renters Continue to Find Themselves Overwhelmed and Underpaid
New Jersey's high cost of housing highlighted in 2011 Out of Reach report
According to a national report released today, the Housing Wage for New Jersey is $24.54 making the state the fourth most expensive in the nation, excluding Washington, DC. 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. New Jersey's Housing Wage has increased 56% since 2000.
The report, Out of Reach 2011, was jointly released by the National Low Income Housing Coalition (NLIHC), a Washington, D.C.-based housing policy organization, and the Housing and Community Development Network of New Jersey. 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.
"This data only emphasizes the need for more affordable home choices in our state," said Diane Sterner, executive director for the Housing and Community Development Network. "The governor's proposed state budget has no money to either build or rehabilitate new homes that our hard working families can afford. On the contrary, for the third year in a row NJ's Affordable Housing Trust Fund is being raided. How can we expect New Jersey's economy to bounce back when its workforce can't afford to live here? In order to move our economy forward, we need to create homes and jobs in environmentally appropriate places with access to transit."
To gauge affordability, the NLIHC and the Network both use the widely accepted measure that no more than 30% of a person's income should be spent on housing. As the fair market rent in the state for a two bedroom rental is $1,276, a family must earn $51,044 annually in order to afford a two bedroom rental. Using that formula, a minimum wage worker would have to work 135 hours or 3.4 full time jobs per week to afford a modest two-bedroom apartment.
The typical renter in the state earns $15.82 per hour which is $8.72 less than the hourly wage needed to afford a modest unit. An estimated 61% of New Jersey renters do not earn enough to afford a two-bedroom unit at the Fair Market Rent.
Housing advocates point to the data that illustrates the large percentage of renters unable to afford homes throughout New Jersey as reason for protecting the state's Affordable Housing Trust Fund and State Rental Assistance Program (SRAP).
“New Jersey’s project-based state rental assistance program is not a hand-out program," said Tri-City Peoples Corporation’s CEO Toni L. Caldwell. "Rather, it helps low-income families to be or become self-sufficient."
"The good news is that the governor plans to fund the State Rental Assistance Program," said Herb Levine, executive director for the Mercer Alliance to End Homelessness. "The bad news is that he plans to take any money left in the State's Affordable Housing Trust Fund and this is money whose purpose is to build more homes affordable to struggling individuals and families."
According to Out of Reach 2011, Bergen and Passaic are the most expensive counties in the state with 76% of renters in Passaic in particular unable to afford the local Fair Market Rent. Cumberland and Essex counties follow closely behind with 71% and 66%, respectively, unable to afford the Fair Market Rent.
"Creating a more affordable New Jersey has always been one of my top priorities, especially for our working class residents and especially in these difficult economic times," said Assembly Speaker Sheila Y. Oliver (D-Essex/Passaic). "We’ve worked hard to protect housing assistance, combat high property taxes that can make home ownership difficult and fix our broken affordable housing system by replacing it with one that opens housing opportunities to everyone. It’s a tough fight and we have a long way to go to convince everyone to make it a priority, but we will not give up until we confront the difficulties that many residents face when it comes to affording a home."
Results of the report were released today at events in Irvington, Plainfield, and Trenton. Participants included Assembly Speaker Shelia Oliver, Assemblyman Speaker Pro Tempore Jerry Green (D-Union/Middlesex/Somerset), Senator Shirley K. Turner (D-Mercer), housing advocates, renters, special needs providers, and community developers.
The New Jersey data from Out of Reach 2011 is also available at http://bit.ly/lIegW1. For the complete report, please visit www.nlihc.org/oor2011/.
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