Here's a report from Reuters.
'U.S. home prices may have dipped over the past year, but many American workers would still struggle to afford a median-priced home in major cities, a new study said on Wednesday.
"American workers are really not gaining ground and they're so far behind in the first place," said Barbara Lipman, research director for the nonprofit Center for Housing Policy, which conducted the study.' Source: Reuters
Here's the full text of the news release from the non-profit group:
HEALTH CARE WORKERS PRICED OUT OF HOMEOWNERSHIP IN MAJORITY OF U.S. METRO AREAS, NEW STUDY FINDS
Center for Housing Policy Releases Disturbing New Housing Data for More Than 200 Metro Areas and 60 Occupations
Homes for Working Families Delivers New Resource Handbook of Proven Solutions to Help Ease the Housing Crisis
Washington, DC (January 10, 2007) – Health care workers are priced out of homeownership in the majority of U.S. Metropolitan areas nationwide, according to a new study of more than 200 Metro areas and 60 occupations released today as part of a joint announcement by the Center for Housing Policy and Homes for Working Families.
Specifically, the groundbreaking Center study Paycheck to Paycheck: Wages and the Cost of Housing in America found that licensed practical nurses would not qualify to purchase the median priced home in an astounding 187 of the 202 Metro areas studied, followed by registered nurses at 115 and physical therapists at 104, while nursing aides and home health aides are priced out of homeownership in all the Metro areas studied.
To address these and other housing challenges that key community workers face, Homes for Working Families has released Increasing the Availability of Affordable Homes: A Handbook of High-Impact State and Local Solutions, which identifies 22 proven high-impact policies that state and local leaders can implement to expand the availability of affordable homes within their jurisdictions.
“With Americans living longer and the baby boomer generation aging, our communities will need more health care workers to meet the growing demand. However, if these workers cannot afford to become homeowners, as this study shows, it will likely become difficult to attract a sufficient workforce,” said Center Chairman Kent Colton, president of K Colton LLC and senior scholar at the Joint Center for Housing Studies of Harvard University. “It is also clear from this study that housing affordability concerns stretch beyond the health care field to a spectrum of other occupations.”
“The lack of affordable homes for America’s working families is nothing short of a crisis, but solutions do exist. We are determined to bring those solutions to the forefront and provide decision-makers with practical policies they can adopt using tools such as our new resource handbook,” said Beverly L. Barnes, executive director of Homes for Working Families.
Paycheck to Paycheck Analyses
Health Care Workers
The Center’s study found that, overall, in the United States, an annual income of $84,957 was needed to qualify to purchase the median priced home of $248,000 in the third quarter of 2006. Yet, during this period the median annual salaries of registered nurses ($58,640), licensed practical nurses ($37,127), nursing aides ($24,745), physical therapists ($62,417) and home health aides ($20,414) all fell short.
Significant rental findings for health care workers in the 210 Metro markets studied reveal that nursing aides cannot afford to rent a typical one-bedroom home in 80 of the Metro areas or a typical two-bedroom home in 147 of the Metro areas studied. Home health aides cannot afford to rent a one-bedroom home in 144 of the Metro areas or a two-bedroom home in 201 of the Metro areas studied.
Additional Community Occupations
As part of its latest Paycheck to Paycheck study, the Center also performed a housing affordability analysis for the community workers on which the popular annual study traditionally focused in the past – elementary school teachers, police officers, nurses (data provided above), retail salespersons and janitors.
The study found that police officers would not qualify to purchase the median priced home in 161 of the 202 Metro areas studied, followed by elementary school teachers at 157, and retail salespersons and janitors who are priced out of homeownership in all the Metro areas studied.
Nationwide, the median annual salaries of elementary school teachers ($47,104), police officers ($45,780), licensed practical nurses ($37,127), retail salespersons ($24,597) and janitors ($23,724) all fell below the $84,957 annual income needed to qualify to purchase the median priced home of $248,000.
On the rental side, significant findings for the 210 Metro markets studied reveal that janitors cannot afford to rent a typical one- bedroom home in 91 of the Metro areas or a two-bedroom home in 177 of the Metro areas studied. For retail salespersons the typical one-bedroom home is unaffordable in 78 of the Metro areas and the typical two-bedroom home is unaffordable in 162 of the Metro areas studied.
New Resource Handbook Solutions
Increasing the Availability of Affordable Homes offers solutions to the growing crisis identified in the Paycheck to Paycheck study by detailing strategies and policies that can be implemented at the state and local levels to begin increasing the availability of homes affordable to working families. The handbook, prepared by the Center’s Executive Director Jeffrey Lubell, is part of Homes for Working Families’ efforts to increase access to homes affordable for working families through meaningful policy change at the local, state and national levels.
Six Strategic Categories and 22 Diverse Policies
The user-friendly policy handbook serves as a practical reference tool for state and local leaders – including elected and appointed officials, employers and other decision-makers – by first identifying six broad strategies for increasing the availability of affordable homes and then detailing 22 diverse policies within those strategic categories.
The six strategic categories are: 1) Expanding the availability of sites for the development of affordable homes; 2) Reducing red tape and other regulatory barriers to affordable homes; 3) Harnessing the power of strong housing markets; 4) Generating additional capital for affordable homes; 5) Preserving and recycling the resources that make homes affordable; and 6) Empowering residents to purchase and retain market-rate homes.
The handbook highlights 22 diverse policy solutions such as: making publicly owned land available for the development of affordable homes, revising zoning laws, leveraging employers’ interest in the creation of affordable homes, and using shared equity mechanisms to create mixed-income communities.
Increasing the Availability of Affordable Homes is among the first tools Homes for Working Families has created to promote state- and local-level solutions that mitigate the affordable housing crisis. Homes for Working Families will make the handbook available to opinion leaders and other advocates on its Web site and will also use the handbook as a “best practices” guide as it focuses on advancing policy changes in some of the nation’s highest-cost housing markets.
About Paycheck to Paycheck
The Paycheck to Paycheck study is provided in online, interactive format. Logon to Paycheck to Paycheck to compare homeownership and rental data for the more than 200 U.S. Metropolitan areas and more than 60 occupations studied.
Paycheck to Paycheck is released annually by the Center for Housing Policy, the research affiliate of the National Housing Conference, based on funding from Freddie Mac. The Homes for Working Families publication Increasing the Availability of Affordable Homes: A Handbook of High-Impact State and Local Solutions was developed with funding from the Annie E. Casey Foundation.
Data Sources for Paycheck to Paycheck
Wage information is as of the third quarter 2006 and was provided by salary.com, a private provider of salary information, which maintains a database of salaries by geographic location.
The home price data are from the third quarter 2006 and include new and existing home sales figures provided by the National Association of Home Builders (NAHB). In select cases where the data from NAHB were not available, existing home sale price data from the National Association of Realtors are provided.
Following conventional mortgage underwriting guidelines, the study assumes that not more than 28 percent of household income should be used to pay the mortgage, property taxes and insurance. The study further assumes a downpayment of 10 percent.
>Typical rents in each metropolitan area are based on the 2006 Fair Market Rents, issued by the U.S. Department of Housing and Urban Development. The weighted average 2006 Fair Market Rent nationwide was $821 a month for a two-bedroom home (the comparable national figure for a one bedroom home is unavailable). The Hourly Wage Needed to Afford (found in the Paycheck to Paycheck online tables) is the hourly wage that must be earned so that this rent does not exceed 30 percent of income, a standard measure of affordability.
The Center for Housing Policy is the research affiliate of the National Housing Conference (NHC). The Center works to broaden understanding of America's affordable housing challenges and examines the impact of policies and programs developed to address these needs. For more information, please go to www.nhc.org.
Homes for Working Families is a nonprofit, charitable organization dedicated to advancing policy changes that enable more of America’s working families to find safe, good-quality homes they can afford. It focuses on the families of teachers, police officers, retail associates, office workers and others who struggle to find homes they can buy or rent in the communities they support. It pursues its mission at the local, state and national levels. For more details, please go to www.homesforworkingfamilies.org.
The Frugal Duchess Boutique