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    Default More Americans spending majority of income on rent

    More Americans spending majority of income on rent, except in Washington





    By Amrita Jayakumar, May 10, 2013 08:04 PM EDT
    The Washington PostPublished: May 10



    The number of Americans spending more than half their income on rent has risen steadily across the country since 2008 — except in the D.C. region, according to a recent report.
    Nationally, the share of working Americans who spend more than half their income on housing costs has grown every year since 2008, reaching 23.7 percent of all working households in 2011, according to the Center for Housing Policy, a research group. It was 21.8 percent in 2008.

    Graphic


    Housing costs hitting renters harder than owners.






    In the Washington region, the percentage shrank: 20.8 percent of working households spend more than half of income on housing, down from 22.5 percent in 2008. The report defines working households as those that average at least 20 hours of work a week and in which total income is no more than 120 percent of the region’s median income.

    Conventional wisdom suggests renters shouldn’t be spending more than a third of monthly income on housing costs, analysts said.

    The findings reflect Washington’s unique position, analysts said. The region escaped the worst of the recession, and its housing market has weathered the downturn with less damage than some of the hardest-hit areas. The housing crisis drove up rental demand and prices in many cities as troubled borrowers were forced from their homes. But the effect was more muted in the D.C. area, analysts said.

    “During the recession, there were a lot of job losses nationwide, but not so much in the Washington area,” said William Rich, senior vice president of the Alexandria-based research firm Delta Associates. “At the same time, rental rates increased at a slower pace.”

    A construction boom in the region is expected to help keep rental prices from increasing quickly, analysts said. Developers broke ground on nearly 15,000 apartment units last year, many in the luxury-rental sector.

    Across most of the country, many renters are facing a double whammy of falling income and rising rents, said Maya Brennan, senior research associate at the Center for Housing Policy and co-author of the report. Between 2008 and 2011, median rents rose nearly 6 percent, while income fell by more than 3 percent.

    The average rent in the D.C. area rose during that period, too, by about 11 percent. But while income fell in most of the country, it grew by 4.2 percent locally. Washington rents are high in comparison with many cities, but that is offset by above-average income, housing experts said.
    Overall, eight out of 10 working households in the country struggle with housing costs, the report shows. Homeowners are slightly better off than renters; the percentage of owners who spend more than half their income on housing has stayed essentially the same, about 20.9 percent, from 2008 to 2011.

    The problem of expensive housing affects all income classes but hits lower-income workers the most, according to the report. Among working households earning less than 30 percent of their region’s median income, more than 80 percent spent a majority of their paychecks on housing in 2011. For those who earn 31 to 50 percent of median income, the share was more than 40 percent.
    High rent squeezes a renter’s ability to save, and some businesses in high-rent areas struggle to find workers they can afford, analysts said. Also, low mortgage rates have made homeownership attractive, but renters may not be able to afford a down payment.

    “If most of your income goes to rent, you can’t save for a down payment,” said Jed Kolko, chief economist at Trulia, a real estate research firm.
    Rents will eventually fall as the supply of rental housing increases, analysts said. In states such as Florida and California, private investors have been buying residential properties to convert them into rentals. New construction also has started to tick upward.

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    If more than 25% of your income goes to pay for your housing you are a pauper and living hand to mouth whether you know it or not. The Bible clearly shows us what usury does, we are slaves.

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    Quote Originally Posted by MsPaulRevere View Post
    If more than 25% of your income goes to pay for your housing you are a pauper and living hand to mouth whether you know it or not. The Bible clearly shows us what usury does, we are slaves.
    23.84% of my income goes to rent. The there are the electric/water/trash so more like 28 percent or so.

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    What is wrong with the economy in general? It is the fact that while the costs of essentials have steadily increased (food, clothing, shelter), wages and income have not. So you get a squeeze, where the increasing costs of essentials crowds out the "discretionary" spending on non-essentials. As an ever increasing amount of money goes to essentials the demand for non-essentials falls, production of that stuff falls, and unemployment rises. This creates a downward spiral that has been in evidence since the late 1970's, when incomes for the average American stalled.

    The delay in the worst effects (which we are experiencing now) was caused by the excessive use of credit (starting in the late 1970's), and the outsourcing of production and the "Wal Mart" effect of falling prices for consumer goods. Both those stop gap measures hit a wall in 2006/7 however. Now we find ourselves with maxed out credit, gutted production, and a floor under prices.

    The only solution now is the redistribution of accumulated capital from the wealthy, who during this time took all the benefit of growth and made out like bandits on a historic scale. That money has to be returned to consumers through higher incomes, who can then return to discretionary spending, increasing employment, and reversing the spiral. But of course, that smacks of socialism, and we can't have that. So, fettered by ideology alone, the future simply looks bleak.

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    I save more money on what I don't pay for!!!

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    Some of this is average greed.

    Years ago most rented at a reasonable rate, at least during the 50's, 60's, 70's

    For years I've heard regular slobs discuss how they are purchasing a double and the renter will cover the mortgage, or similar schemes.

    I can understand charging enough rent to pay for cost, upkeep and a reasonable amount of profit - I can't understand scr**ing your fellow man.

    I know many who landlord - I seriously doubt any of them pay federal or state taxes on the income, they pay just property and school taxes.

    So you have landlords getting wealthier by the minute - if property and school taxes are raised - just raise the rent.
    Conversely quite a few of these types are retired and getting sooo much "retirement" monies monthly they are desperate to find a place to "stash" their extra, unneeded wealth.

    So a large percentage of those at the middle and upper rungs of the ponzi pyramid are doing great, collecting, many collecting 1,2,3 retirement checks, thousands monthly, while squeezing the poor and desperate every chance they get with exorbitant rent. Also known as slumlords.

    If the feds and states really wanted to collect taxes fairly - they could do property ownership checks and cross reference their income claimed -
    probably hundreds of millions of dollars in tax revenue lost.

    Another reason why the poor and lower income class middle aged and younger - and the aged, retired who can not get subsidized, socialized housing - are perpetually screwed.

    We are Free To Scr*w Our Fellow Man in IOUSA Land.

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    Quote Originally Posted by Aetius Romulous View Post
    What is wrong with the economy in general? It is the fact that while the costs of essentials have steadily increased (food, clothing, shelter), wages and income have not. So you get a squeeze, where the increasing costs of essentials crowds out the "discretionary" spending on non-essentials. As an ever increasing amount of money goes to essentials the demand for non-essentials falls, production of that stuff falls, and unemployment rises. This creates a downward spiral that has been in evidence since the late 1970's, when incomes for the average American stalled.

    The delay in the worst effects (which we are experiencing now) was caused by the excessive use of credit (starting in the late 1970's), and the outsourcing of production and the "Wal Mart" effect of falling prices for consumer goods. Both those stop gap measures hit a wall in 2006/7 however. Now we find ourselves with maxed out credit, gutted production, and a floor under prices.

    The only solution now is the redistribution of accumulated capital from the wealthy
    , who during this time took all the benefit of growth and made out like bandits on a historic scale. That money has to be returned to consumers through higher incomes, who can then return to discretionary spending, increasing employment, and reversing the spiral. But of course, that smacks of socialism, and we can't have that. So, fettered by ideology alone, the future simply looks bleak.
    Your idiocy astounds me - keep drink'n that kool-aid

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    I'm still trying to figure out how people in my area afford rent.

    Rent for a 3 BR condo in my complex goes for $2,200/month. For someone to afford the rent at no more than 25% of their income, they would need to be making $120,000 a year. At that point, why rent, might as well buy.

    DH and I make decent money and I couldn't afford the rent. We bought on foreclosure years ago. Otherwise we wouldn't be able to afford to live here.


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    Quote Originally Posted by LYCAN View Post
    Your idiocy astounds me - keep drink'n that kool-aid
    Do you have an alternative analysis, or are personal insults all you got?

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    Quote Originally Posted by Aetius Romulous View Post
    What is wrong with the economy in general? It is the fact that while the costs of essentials have steadily increased (food, clothing, shelter), wages and income have not. So you get a squeeze, where the increasing costs of essentials crowds out the "discretionary" spending on non-essentials. As an ever increasing amount of money goes to essentials the demand for non-essentials falls, production of that stuff falls, and unemployment rises. This creates a downward spiral that has been in evidence since the late 1970's, when incomes for the average American stalled.

    The delay in the worst effects (which we are experiencing now) was caused by the excessive use of credit (starting in the late 1970's), and the outsourcing of production and the "Wal Mart" effect of falling prices for consumer goods. Both those stop gap measures hit a wall in 2006/7 however. Now we find ourselves with maxed out credit, gutted production, and a floor under prices.

    The only solution now is the redistribution of accumulated capital from the wealthy, who during this time took all the benefit of growth and made out like bandits on a historic scale. That money has to be returned to consumers through higher incomes, who can then return to discretionary spending, increasing employment, and reversing the spiral. But of course, that smacks of socialism, and we can't have that. So, fettered by ideology alone, the future simply looks bleak.
    very much a yep'
    as far as wealth distribution we're just talking pay raises for workers but this won't happen with the labor glut that should be with us til the babyboomers head out to pasture

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