D.C.'s Rent Prices 2nd Only to Hawaii's: Report

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    NEWSLETTERS

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    It's no secret D.C. is growing rapidly, but a new national report puts the District as having the second highest rental prices in the country -- behind only Hawaii.

    The report also reveals that affordable rent is scarce for many across the country.

    In D.C., a full-time worker would need to earn $28.25 to afford a two-bedroom unit, which could be considered the minimum amount of space needed to house a family.

    "If you want to be anywhere close to the thoroughfares, the major policy areas, you're going to pay a price," said one renter.

    D.C. Rental Market Highest Behind Hawaii

    [DC] D.C. Rental Market Highest Behind Hawaii
    A new national report puts D.C. as the number two location for some of the highest rental prices in the country. News4's Kristin Wright explains why these findings are worrisome to more than those looking for a place to live in our area. (Published Friday, Apr 18, 2014)

    A minimum wage worker in D.C. would have to work 137 hours per week to be able to spend only 30 percent of their income to rent that apartment, according to an annual report by the National Low Incoming Housing Coalition (NLIHC).

    "What's alarming about the report is things aren't getting better for the lowest-income renters," said Linda Couch, senior vice president for Policy and Outreach at the NLIHC. "And when we look at the mismatch between what people are earning and what rents actually are in the D.C. metro area, that gap is widening...."

    Maryland also ranked high on the list, as the fourth most expensive rental market. There, a full-time worker would need to bring in $24.94 per hour to get that two-bedroom.

    The nationwide average is only a little better. A full time worker would need to earn $18.92 an hour to afford a two-bedroom rental in the U.S., without spending more than 30 percent of income toward rent.

    But the advocacy group's study, which is based on the 2012 census and median income statistics, shows that in many states a person must earn even more per hour to pay fair market rent for a two-bedroom unit.

    Fair market rent, which is set by the U.S. Department of Housing and Urban Development, is calculated with the idea that no more than 30 percent of one's income is spent on rent.

    Here's a rundown on the six least affordable states for renters, and what a worker would need to earn per hour to afford a two-bedroom:

    • Hawaii: $31.54 per hour
    • D.C. $28.25 per hour
    • California: $26.04 per hour
    • Maryland: $24.94 per hour
    • New Jersey: $24.94 per hour
    • New York: $24.87 per hour

    More than half of D.C. residents are renters, as are more than 40 percent of residents of Fairfax, Montgomery and Prince George's counties -- and parking is often an additional expense for renters.

    D.C. resident Ralph Wong said parking costs him another $200 on top of his rent.

    "I'm not happy about it," he said. "It's actually a substantial portion of my paycheck."

    The report shows that it takes 2.6 full-time minimum wage jobs to afford a typical two-bedroom apartment in the United States. Rentals are most affordable in Puerto Rico, where a family would need just 1.4 minimum-wage jobs for the typical rental. In Hawaii, it would take 4.4 minimum-wage jobs for a typical two-bedroom rental.

    The report, released in March, comes amid a push to raise the federal minimum wage from $7.25 to $10.10 per hour.

    Connecticut, where an average person needs to earn $23.02 to afford a two-bedroom rental unit, made headlines recently by becoming the first state to adopt a law to raise the minimum wage to $10.10, and since then, D.C. and Maryland have also approved a minimum wage increase -- D.C.'s from $8.25 to $11.50 by 2016, and Maryland's from $7.25 to $10.10 by 2018.

    Still, the NLIHC report found that nowhere in the U.S. can a person making the current federal minimum wage afford a two-bedroom rental unit at fair market rent while logging a 40-hour work week without paying more than 30 percent of their income. Before taxes, the annual salary of a minimum-wage worker who puts in 40 hours a week is $15,080.

    And Couch said a minimum wage increase won't be enough.

    "Looking around the streets of D.C.... there's no better time to understand that the tourism industry is critical to this city, and its service workers who are the backbone of our economy," she said. "And these service workers are facing having to earn $28 an hour in order to afford the average two-bedroom apartment, and it's still well above $20 an hour just to afford an efficiency. And so we need some more resources to help families fill that gap."

    Couch advocates a national housing trust fund, which would be funded nationally and push money to every state.

    "It's not that people aren't working; it's that working doesn't provide what people need to meet their most basic needs," she said.