Weekly Real Estate News
None of the nation’s 50 major metro areas are affordable for minimum wage earners seeking to rent a one-bedroom apartment.
A new report by Best Interest Financial and Clever Real Estate measured affordability with the metric that a household should spend no more than 30% of its gross monthly income on housing. Using this metric, the report found the monthly rent for a one-bedroom apartment costs more than a minimum-wage worker earns in an entire month in 14 of the 50 metros.
Although minimum wages vary across the country, 17 of the 50 most-populous metros still pay the federal minimum of $7.25 an hour. Federal minimum wage workers would have to work 174 hours a week to afford the median one-bedroom rent in the 50 largest metro areas.
In 12 metros, four minimum wage workers would need to share a one-bedroom apartment to afford rent under the 30% rule. And five minimum wage workers would need to share a one-bedroom apartment to afford monthly rent in eight metros.
The report found Atlanta is the most expensive metro for minimum wage workers, who would spend 143% of their gross monthly income on typical rent. A minimum wage worker in Atlanta brings home about $1,160 a month, roughly $500 short of the $1,660 needed to cover rent.
On the flip side, St. Louis is the most affordable metro – minimum wage workers earn $15 an hour and pay $995 for a one-bedroom apartment, with rent consuming about 41% of gross monthly income – which is still above the recommended 30%.
The report also determined that if every metro raised its minimum wage by $10 an hour, only St. Louis, Kansas City, and Detroit would become affordable for renters.
You can’t be serious; I couldn’t afford a one-bedroom apartment on minimum wage in 1971. I was making $ 5/hr in 1975; the minimum wage was $2.10. A one-bedroom apartment was $150. /month in Anaheim, CA where I lived. I was paying $170. / a month for a two-bedroom, with a roommate to split the rent.
I would like to know if, a minimum wage earner could afford any one bedroom apartment in the same metropolitan areas, in the last 3, 7 or 15 years?
I’d be curious to see where a minimum wage earner could live at all, whether a second tier MSA, or how far down would you have to dig to find anything? We are currently developing micro-communities specifically because of this affordable housing crisis point.
When I was making minimum wage in 1975 neither could I! In the early 70s, my first job paid $2/hour. What I could afford was a room in a house or a very small, old studio apartment!