2020-01-31 — bloomberg.com
Earning $40,000 a year in Omaha used to be enough to make rent comfortably. Not anymore. Housing costs are slipping out of reach for the middle class in smaller and medium-size cities across the U.S., the latest sign that the affordability crisis that started on the coasts is moving inland, according to research released on Friday by the Harvard Joint Center for Housing Studies. From 2011 to 2018, the proportion of households making $30,000 to $45,000 a year that were "cost-burdened" -- paying more than 30% of their income on rent -- soared the most in metros including Nashville, Tennessee; Greenville, South Carolina; and McAllen, Texas.
The data highlight a harsh reality of the U.S. economy a decade into the longest expansion on record: For people who don't make big salaries, there are fewer and fewer affordable places to go.
Wage growth has been lackluster in recent years compared with previous periods of economic expansion, and has failed to keep pace with rental costs. The consumer price index for rent rose an average 3.2% year-over-year from 2011 through 2019, Bureau of Labor Statistics data show. That outpaced average yearly earnings growth over the period of 2.4%.
The share of low-cost units in the national rental stock shrank to 25% in 2017 from 33% in 2012 -- with the biggest declines in Iowa, Montana, Nebraska, North Dakota, Oklahoma, and Texas.
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