Out of Reach 2001: America’s Growing Wage-Rent Disparity
Where the Numbers Come From


Sample Data: Transylvania County, North Carolina

 
 
Location Number of Renter Households
1990 2000 Percent Change,
1990-2000
Transylvania County   2,096  2,539  21.14%
1990 and 2000 U.S. Census.
 
2001 Family Income
Location 2001 Estimated Median Family Income (HUD) Maximum Affordable Monthly Housing Cost by % of Family AMI
Annual Monthly 30% 50% 80% 100%
Transylvania County   $43,500  $3,625  $326  $544  $870  $1,088
  Developed by HUD, based on 1990 Census family median income estimates. Multiply Family AMI by percent of AMI given (30% = .30) to determine income ($43,500 x .30 = $13,050). Then multiply by .3 to get maximum amount that can be spent on housing for it to be affordable ($13,050 x .30 = $3,915). Divide by 12 to obtain monthly amount ($3,915 / 12 = $326).
 
2001 Fair Market Rents by Number of Bedrooms
Location Zero One Two Three Four
Transylvania County   $350  $375  $474  $628  $671
  Developed by HUD, updated yearly based on Consumer Price Index data or HUD regional rent change factors developed from Random Digit Dialing surveys.
 
Income Needed to Afford FMR
Location Amount Percent of Family AMI
Zero
Bedrooms		 One
Bedroom		 Two
Bedrooms		 Three
Bedrooms		 Four
Bedrooms		 Zero
Bedrooms		 One
Bedroom		 Two
Bedrooms		 Three
Bedrooms		 Four
Bedrooms
Transylvania County  $14,000  $15,000  $18,960  $25,120  $26,840  32%  34%  44%  58%  62%
Multiply the FMR for the number of bedrooms indicated by 12 to get yearly rental cost (1BR: $375 x 12 = $4,500). Then divide by .30 to determine the total income needed to afford $4,500 per year in rent ($4,500 / .30 = $15,000). The ratio of income needed for a unit with the number of bedrooms indicated (1BR: $15,000) divided by family AMI ($43,500) multiplied by 100 (($15,000/$43,500) x 100 = 34%).
 
 Location
Housing Wage
Hourly Wage Needed to Afford
(@ 40 hrs./wk.)
Percent Change
in 2BR
Housing Wage
(2000-2001)
As % of Minimum Wage
( NC=$5.15 )
Zero
Bedroom
FMR
One
Bedroom
FMR
Two
Bedroom
FMR
Three
Bedroom
FMR
Four
Bedroom
FMR
Zero
Bedroom
FMR
One
Bedroom
FMR
Two
Bedroom
FMR
Three
Bedroom
FMR
Four
Bedroom
FMR
Transylvania County
 $6.73
  $7.21  $9.12
 $12.08
  $12.90  2.60% 131%
140%
177%
 234% 251%
Divide income needed to afford the FMR for a unit with the specified number of bedrooms (1BR: $15,000) by 52 (weeks per year) ($15,000 / 52 = $288.46). Then divide by 40, for the number of hours per work week ($288.46 / 40 = $7.21). In 1999, the 2 bedroom housing wage for Transylvania County was $8.88. Divide this number by the 2000 figure ($9.12) ($8.88 / 9.12 = .97368) and subtract this number from 1 and multiply by 100 ((1-.97368)x100 = 2.6%). Hourly wage needed to afford the FMR for a unit with the number of bedrooms indicated (3BR:$12.08) divided by $5.15, the minimum wage. This number is then multiplied by 100. (($12.08/$5.15) x 100 = 235%).
 
Location
Work Hours/Week
Necessary at Minimum
Wage to Afford
( NC=$5.15 )
Zero
Bedroom
FMR
One
Bedroom
FMR
Two
Bedroom
FMR
Three
Bedroom
FMR
Four
Bedroom
FMR
Transylvania County  52  56  71  94  100
Divide income needed to afford the FMR for a unit with the specified number of bedrooms (2BR: $18,960) by 52 (weeks per year). Then divide by $5.15, the minimum wage. ($18,960/52 = $364.62; $364.62/$5.15 = 71 hours).