Soaring Costs Force Some Renters To Choose Between Shelter And Food

NEW YORK -- Around 10 million American households -- or one in every four families that rent their homes -- could have to choose between paying rent, buying groceries or keeping current with bills, according to a report released Tuesday.

The number of households spending more than 50 percent of their income on rent and bills jumped by 2.6 million over the last decade, according to a Harvard Joint Center for Housing Studies report. Economists generally consider "affordable" rent to cost about 30 percent of a tenant's income.

When housing costs hit certain levels, many Americans are forced to choose between rent and food. "In real terms, it means more people have less money to spend on household necessities such as food, health care, or savings," Eric Belsky, director of the Harvard Joint Center for Housing Studies, said in the report. Households which spend 50 percent or more of their income on rent also spend almost 40 percent less on food and over 50 percent less on health care than households with more affordable rent.

“In the last decade, rental housing affordability problems went through the roof,” Belsky said in the report. “And these affordability problems are marching up the income scale," he added.

Already, rising rents mean the household budgets of working-class and middle-class families are under strain. Growing numbers of middle-income, and lower-middle-income renters are spending between 30 percent and 50 percent of their incomes on rent. And the report found that rents could start to soar as the recovery takes hold.

Belsky said that after a boom, the rental market took a brief hit during the recession. "Rental housing costs went up and up. There was a brief dip in 2009, now they've moved up again," he told The Huffington Post. Affordability could become such a problem, Belsky said, that even financially secure Americans could start to struggle to make rent.

Even before the recession, rent increases and growing bills outpaced many stagnant salaries. Now, with modest improvements in the job market, there is renewed upward pressure on rents. Many former homeowners who faced foreclosure are now looking to rent, and people who ordinarily would have bought homes are struggling with tighter mortgage lending, while others are waiting for home prices to sink even lower.

Mortgage lending for apartment buildings -- the multifamily sector -- was severely hit during the financial crisis, and financing for the sector has dropped by $40 billion, according to the report.

Since 2008, the only refinancing for loans on apartment buildings has come from federally-backed sources: Fannie Mae, Freddie Mac and the Federal Housing Administration.

And for Americans with lower incomes, the availability of federally protected affordable housing is shrinking. The report found 700,000 affordable rental units had either been removed from federal programs or demolished since the mid 1990s, with very little new housing being offered at the lower end of the rent scale.

Comments

[rizzi41]

03:55 PM on 04/30/2011

Don't you's people get it?loss of jobs,homes,,and soaring gas prices which inflates food,clothes,
medical supplys etc.which in the long run takes away your independance.All you people who
have your head in the sand,better read your declaration of independance,and excersize your rights
call your reps.and tell themyour state is going to excersize there rights in accordanceto the D.O.I.
Who is obama to give billions to so.america for drilling and we can't drill He's beating you with
your tax dallors.also cutting your benefits that your paying for.

[Muhtadi]

10:54 PM on 04/27/2011

“Around 10 million American households -- or one in every four families that rent their homes -- could have to choose between paying rent, buying groceries or keeping current with bills, according to a report released Tuesday.”

Last statistic I read also said something like 40 million people (one in every four households) receive food stamps so I don’t think the choice is between rent and food.

[NewAmericanow]

03:01 PM on 04/27/2011

The Empire of America IS coming to a close like many powerful Empires before her. She is exhibiting all the signs of impending collapse, like suppression of protest, imprisonment without trial, torture, arrest of the press, searches without cause or warrent and unable to police it's borders. Like Rome the citizens were given bread and circus to keep their bellies full enough and entertained with nonsense so as to keep them quiet. Do you realize what will happen when no one wants the depreciating dollar? Do you know what happens when it takes more money to buy oil? Be prepared http://www.newamerica-now.blogspot.com http://www.youtube.com/newamericanow

[wzjussayin]

07:10 PM on 04/27/2011

Her teachers no longer able to teach third-graders and self-proclaimed "bloggers" the difference between its and it's.

[Kurt]

01:45 PM on 04/27/2011

The Republican philosophy and effect of proposed budget reductions  the über rich and corporations get tax cuts but the poor and middle classes keep getting squeezed. Look, when 10% of the county owns 90% of the wealth, it's time to tax wealth in addition to income.

Many Republicans want to reduce modern worker & health protections by cutting the funding supporting enforcement, eliminate Medicaid, privatize Medicaid, and take away modern consumer protections with the intent to go back to the glorious 19th century when large banks controlled money, monopolies cheated everyone, and wages were so low that a mortified Prince Albert took to designing affordable worker housing.

"Impossible!" you say. I ask you, WHY do they defend the irresponsible spending habits of the over rich, denounce unions, and try to defund modern safety net programs if they do not see that most complex century's philosophy and morality as a model?  Without naming it, by their budget cuts in education they endorse social darwinism. By inventing the myth of American "Exceptionalism" they revive manifest destiny which gives them permission to sneer at cultures they do not understand.

So, I take them at their word. 

Now remember, America and the world was more prosperous during those times when taxes on the rich and corporations were high, the mid-20th Century, and college costs were low.   THE SOLUTION to our problems is to increase taxes on the über rich  and their corporations on gross income plus net worth then  use the money to

[laurieanichols]

10:18 AM on 04/27/2011

This is getting scarier, the jobs market is only getting better if you are willing to take a substantially lower wage and even then you are lucky to get full-time work. Everything has increased dramatically in price and it is not because of inflation as we knew it back in the 70"s. This increase in prices is due to the price of oil, the falling value of the dollar and climate change that is wrecking crops all over the world. I would say that these problems are still solvable but the thinking has to be so outside the box that I doubt that any one in D.C is up to the task. We are desperately trying to hang onto a way of life and the environment is sending us a loud message that our way is unsustainable, we ABSOLUTELY need clean environmental policies enacted immediately. Which is to say that in the D.C. political arena right now is not going to happen. I did not even mean to deviate from the purpose of the article, I just went towards the environment when I typed the words oil and food prices. They are linked unfortunately.

[CRF250x]

09:04 AM on 04/27/2011

As a land lord I tried not to raise my rent however the increase of Connecticut property Taxes and property insurance has left very little choice for me as the owner.
I make a very small profit on my condo and keep it clean and nice for my tenants. The issues are working wages for the people who need to rent, the cost of basic utilities and the cost of rising food prices.

[Tony Anzalone]

08:54 AM on 04/27/2011

Yesterday I read an essay about New York in the mid-19th century and how people were so poor they had to send their children out to pick rags from the garbage and scoop up spilled flour and sugar from the ground, from the GROUND and resell these items for pennies all day and then at the end of the day they would bring back the change and give it to their parents. Many times this was not enough for the family to eat so these children would be forced to resort to theft, pickpocketing and prostitution just to keep the family eating one more day. Then I read these comments. Man you guys have it soooo bad, sorry but you all just sound like typical spoiled Americans totally unaware that what you actually do have is more than what half the planet’s population has or will ever have. I don't think we would hear depression era survivors complaining because they cannot buy name brands or that their government check doesn't quite cover what it used to. You know how lucky you are to even get a government check? If it were up to the Republicans nobody would. Pull it together people everything is going to be fine. You will be back to eating out twice a week before you know it.

[KDMac]

09:26 AM on 04/27/2011

From a Heritage Organization study in 2004:

The following are facts about persons defined as "poor" by the Census Bureau, taken from various government reports:

Fortysix percent of all poor households actually own their own homes. The average home owned by persons classified as poor by the Census Bureau is a threebedroom house with oneandahalf baths, a garage, and a porch or patio.
Seventysix percent of poor households have air conditioning. By contrast, 30 years ago, only 36 percent of the entire U.S. population enjoyed air conditioning.
Only 6 percent of poor households are overcrowded. More than twothirds have more than two rooms per person.
The average poor American has more living space than the average individual living in Paris, London, Vienna, Athens, and other cities throughout Europe. (These comparisons are to the average citizens in foreign countries, not to those classified as poor.)
Nearly threequarters of poor households own a car; 30 percent own two or more cars.
Ninetyseven percent of poor households have a color television; over half own two or more color televisions.
Seventyeight percent have a VCR or DVD player; 62 percent have cable or satellite TV reception.
Seventythree percent own microwave ovens, more than half have a stereo, and a third have an automatic dishwasher.

[SF TKF]

06:31 PM on 04/27/2011

I'm not sure what you're point is? Poor in American /= poor in Bangladesh?

[runswithscissors]

07:00 PM on 04/27/2011

"Fortysix percent of all poor households actually own their own homes"

They own the home, or they're keeping it occupied as their balloon mortgage becomes unsustainable?

"Only 6 percent of poor households are overcrowde d. More than twothirds have more than two rooms per person. "

So because people aren't sleeping in the kitchen, dining room, bathrooms, garage, hallways, and the patio the house isn't overcrowded?

"The average poor American has more living space than the average individual living in Paris, London, Vienna, Athens, and other cities throughout Europe."

Does that count the land as well? Comparing single-dwelling plots of land to apartments/flats in major European cities is a pretty convenient way to skew that statistic. Regardless, the obsession with space for living has hardly served the poor well in this country. Urban flight leading to an underfunding of city programs, combined with gentrification that prices the poor out of their own homes in cities has pretty much dictated the arrangement today.

"Nearly threequart ers of poor households own a car."

Gutting mass transit systems, while keeping in mind the aforementioned forced driving the poor from cities, again makes this result pretty obvious.

As for the rest, were they purchased new or used? How many got the diswasher with the house? Those other "luxury" items can be found in just about any house in developing countries. Yet, they're supposedly benchmarks in the world's richest?

Always treat anything published by the Heritage Organization with suspicion.

[lyredragon]

08:01 AM on 04/27/2011

I am one of those 1 in 4 renters, wages go up by $0.25 per hour every year, but rent goes up $20 per year. When I moved in, I was paying $60/month electricity, now it's $110. When I moved in all of gas heat, trash and water was paid, and now I have to pay 80% on top of rent increases. Now they're making new renters pay for all services on top of all the increases. Since I started living on my own gas has gone from $1.48/gal to $4.11 and back, and now they're making the self fullfilling prophecy of $5 a reality.

I cant afford a loaf of bread anymore, It costs $2 for just a loaf when I can feed my house for a couple of weeks on the rice that $2 can buy so I can have starch. Milk is the same way. it's no longer a beverage, it's a prized ingredient at $4/gal. I've stopped buying beef, I can't afford fresh vegetables or fruits. I have to wash my clothes in the tub with soap and a washboard because i can't beg my friends and family for machines I got rid of cable TV we split the cell bill on the inlaw's family plan, and we have only one car that is 15y/a. All of our clothes are either from a donation store or homemade. (i knit and sew) We really can't take much more of this.

[Tenorio]

10:30 AM on 04/27/2011

can't take much more? Are you totally oblivious to the fact that you have it darn well compared to others? I have more than 600 dollars a month in medicine that I must have or I die! No cell phone here! If you need to contact someone, send an email on a free computer at the library or use a pay phone for 25 cents. Bread at walmart is only one dollar and twenty cents. Their milk costs little over three dollars. If you splice 2 percent with one third water, it lasts longer and is equivalent to 1 percent. You are spoiled and just complain about luxuries. Tell those living at the shelters about your problems and maybe you will all wake up and realize that necessity and your luxury are not the same thing.

[Hotness]

11:36 AM on 04/27/2011

Lets not glamorize it or sound proud of it. We're not interested in your little drama.

[utilitopia]

12:21 PM on 04/27/2011

Instead of arguing over who is more miserable, how about focusing on the opulent few who live in a relative paradise on earth, with wealth and power beyond your imaginations, and work for an economic system that discourages these enormous society-warping differences?

[PeterNPaul]

07:52 AM on 04/27/2011

All based on the devaluation of the dollar. Ron Paul, right again.

[Patricia Hinchliff]

07:34 AM on 04/27/2011

just let THEM ALL EAT CAKE ..that is what we get ..... when we pay our taxes..... hahahahaha

[CPAwADD]

07:30 AM on 04/27/2011

When Republicans pledged to protect Medicare that was not intended to be a factual statement.

[brokerallen]

09:28 PM on 04/27/2011

They use issues like family values, gay marriage, and abortion to stir up a gullible group of well meaning Christians. It sounds good to those of like minds but there is never strong action on those issues or any other promises. They've been getting away with it forever.

[MacTheBlogger]

07:27 AM on 04/27/2011

NO one who has even a RUDIMENTARY understanding of the most BASIC economic principles can be surprised by this in the LEAST.

We have borrowed far too much, we have allowed the dollar to crash, we've made a mockery of the bond markets, and we have made excuses for it the whole time. And, predictably, BOTH sides of the political spectrum have pointed the finger at the other while REFUSING to look in the MIRROR.

NO one can be surprised. And, yet again, our leaders have failed us. Inflation is here, it will continue, it will increase, and anyone whose eyes are open has seen it coming as a result of our own actions.

Self-inflicted wound. Too bad.
.

[CPAwADD]

07:32 AM on 04/27/2011

We run up the debt precisely at the time we were going to be heading in to the retirement of the baby boom. The tax cuts were never a good idea because we had no means to pay for them.

[MacTheBlogger]

07:35 AM on 04/27/2011

Yup. Not to mention the wars.
.

[ABACADABRA RABBIT]

05:58 AM on 04/27/2011

End NAFTA, Reinstate tariffs on foreign goods. Tax penalties for corporations that send jobs to East Asia. Grow your own food. Lock your doors at night. Crime is going nowhere but up.

Get a bike, gas is going up to $6 per gallon by 2012.

[muck-raker]

06:12 AM on 04/27/2011

Rabbit excellent post, also add dropping World trade org. F&F

[ABACADABRA RABBIT]

04:41 PM on 04/27/2011

thanks Muck! END THE WTO TOO!~

I just didn't want to get sniped like HST.

I'm not a psychopathic demonstrator or anything. We need to begin protectionism. Protectionism against the world, protectionism against the corporate demons that are strangling the struggling middle class!~

:D

[Group 8807]

06:16 AM on 04/27/2011

If gas is $6 a gallon in November 2012, Obama will be a private citizen in 2013.

[KDMac]

09:33 AM on 04/27/2011

Not unless a non-crazy Republican steps up to the plate.

[ABACADABRA RABBIT]

04:42 PM on 04/27/2011

we will see. 1 billion dollars is a lot of money.

[tosc]

04:44 AM on 04/27/2011

the "american consumer" is broke! we are now on a level playing field with many of the world's third world countries, who make these types of basic survival decisions everyday. Our hayday has ended.

[susieqty1]

04:03 AM on 04/27/2011

I am a low income senior and disabled. It wasn't planned, but how it turned out. Is this how the "Golden Years" are supposed to be? I always worked, saved, the usual - I have found recipes on the 'net for making various cleaning, facial & plant products, foods from scratch, buying small plants (they grow) and its takes a while to do, but I save lots! And there is a certain pride attached. I started some plants from seeds - very economical! I found a leather recliner someone didn't need - cleaned it up and protected it - its beautiful! I don't like being broke like this, but have learned that the best thing for me, is to deal with a situation, then let it go. Works every time! Stress used to make me really sick - so I learned to relax - works too! I only buy what I have money for, and let the hype of salespeople go. It would be better for a lot of us, if they could turn that hype into something positive about our current situation, so it could be handled easier. Too many people have to have at least one of everything, so they can sell it cheap, to people like me, at their next garage sale! :-) Thank you, garage sales.

[muck-raker]

06:09 AM on 04/27/2011

susie excellent post, many people could learn a lot from you F&F

[MacTheBlogger]

07:38 AM on 04/27/2011

Bravo, Susie. Especially "I only buy what I have money for, and let the hype of salespeopl­e go." A lesson for millions, including our "leaders".

Best wishes.
.