Why is a two-bed apartment (or "home") considered modest baseline for "someone working a 40-hour week"? And by someone do they mean literally a single person, or a family of 2? 3? I'm not...
Why is a two-bed apartment (or "home") considered modest baseline for "someone working a 40-hour week"? And by someone do they mean literally a single person, or a family of 2? 3?
I'm not disagreeing with the sentiment, I'm paying an outrageous amount for a too-small studio, I'm just confused about the metric. Do single people really live in "modest" homes? I certainly haven't or know anyone that expects to.
That used to be considered modest, back when people were able to get houses right out of school. Maybe it's not anymore, but that's just a reflection of the decreased wealth the average worker had...
That used to be considered modest, back when people were able to get houses right out of school. Maybe it's not anymore, but that's just a reflection of the decreased wealth the average worker had nowadays
Well if you had any kids youd need another room. I don't think it was common for people to be rooming together unless they were family, and it used to be expected that you would have children....
Well if you had any kids youd need another room. I don't think it was common for people to be rooming together unless they were family, and it used to be expected that you would have children.
There are even laws on the books limiting the number of unrelated women that could live in the same dwelling as it was assumed you must be a brothel of you had a bunch of unrelated people living together
I was going to make a similar point. My first apartment was split between four people (3 bed rooms and a make-shift fourth one). My later ones were two bedrooms split between two people. I think...
I was going to make a similar point. My first apartment was split between four people (3 bed rooms and a make-shift fourth one). My later ones were two bedrooms split between two people.
I think that the point of the post stands but expectations are way out of whack. Advertising makes people think they're supposed to have ALL kinds of craziness, which isn't necessarily what people actually need. Needs vs wants folks.
It's not just advertisers, it's also TV shows and movies featuring people in apartments that in no way match their salary. It's not very exciting to see the adventures of people working multiple...
Advertising makes people think they're supposed to have ALL kinds of craziness,
It's not just advertisers, it's also TV shows and movies featuring people in apartments that in no way match their salary. It's not very exciting to see the adventures of people working multiple jobs to make ends meet, and cramped apartments aren't as easy to film due to how little space you have to work with.
I've said it before, and I'll say it here as well. As a country, the US needs to nationalize rental properties. The continuing unaffordability of rental apartments, which has only expanded over...
I've said it before, and I'll say it here as well.
As a country, the US needs to nationalize rental properties.
The continuing unaffordability of rental apartments, which has only expanded over the last several years, has led to a nationwide homeless epidemic.
It's a national shame, and I don't think it will ever be answered/fixed until the price for renting an apartment is forcibly tied to a person's income.
Of course, this brings up many things, not the least of which is angry calls of "SOCIALISM BAD!", and I agree that it's not quite that simple here.
But whatever we do, we had better do something fast, and I see no good reason that we should not all take care of the basic needs of each other.
Let people work for luxury items/better apartments/etc, but no one should ever want for the basic necessities.
Some areas are just too expensive for this. Property taxes are sky high in certain areas, and landlords / companies with rental properties have to pay them. I am in Tulsa OK and I lived in an...
Some areas are just too expensive for this. Property taxes are sky high in certain areas, and landlords / companies with rental properties have to pay them. I am in Tulsa OK and I lived in an apartment complex up until Jan 1 of 2018. The complex changed hands and I got curious about the sell price. So I dug into the property records. The taxes last year were 60k. This is Tulsa, OK. So thing about what places in LA are paying.
Some areas are just nicer and require more money for upkeep. You can't really expect someone with an apartment in a great spot like right on certain shores or right in the middle of downtown of a major city to not charge a lot for that.
If we started to say "Okay you have to charge this based on this." isn't great because we have to take into account the fees the places have to pay to operate. They have to cover those costs some how.
And I am in no means an advocate for landlords and the like. I think they have way too much power and the burden of proof on them is so low they get away with murder. Here in OK, they have to give you notice before they enter. But you don't have to see or even know the notice exists. So they can enter your apartment without notice, and then say oh we totally put it on your door - the wind must have blown it off and that be legally acceptable because the burden of proof is so low and the the tenant really doesn't have any way to fight unless you have a camera shooting your door from the outside 24/7.
I never said that there wouldn't be problems. :-) Yet, I can provide a counterpoint to your story. I live in CA. We have, as far as I know, the highest rental prices in the entire country, beating...
I never said that there wouldn't be problems. :-)
Yet, I can provide a counterpoint to your story. I live in CA. We have, as far as I know, the highest rental prices in the entire country, beating out even New York City.
Yet, through government assistance, I pay a fixed percentage of my income for a pretty nice apartment, which is quite large for one person, considering the overall cramped nature of the city. The complex is managed by a non-profit, and the property taxes get paid just fine.
Of course, I live in a nasty neighborhood, but we can't have everything.
That is a major part of the reason though. Not every complex is owned by a non profit. Imagine having to come up with 60k a year just for the base taxes. That doesn't include all fees and...
The complex is managed by a non-profit, and the property taxes get paid just fine.
That is a major part of the reason though. Not every complex is owned by a non profit. Imagine having to come up with 60k a year just for the base taxes. That doesn't include all fees and everything else like inspections.
That isn't what I am saying... A non profit has much much different priorities than a privately owned rental property. Saying that a loft apartment right in the heart of Nashville or a place in...
That isn't what I am saying... A non profit has much much different priorities than a privately owned rental property. Saying that a loft apartment right in the heart of Nashville or a place in Manhattan should have it's rent based on your income is just short sighted in my opinion. That just won't ever happen.
I never mentioned any other "priorities" other than property taxes, which you brought up. I'd like to keep focused on that, since that is your concern.
A non profit has much much different priorities than a privately owned rental property.
I never mentioned any other "priorities" other than property taxes, which you brought up. I'd like to keep focused on that, since that is your concern.
But that isn't my only concern. I stated other things.. The short of it is this, rent can't be based on income. If someone owns an apartment complex say in LA and they need so much money to cover...
But that isn't my only concern. I stated other things..
Imagine having to come up with 60k a year just for the base taxes. That doesn't include all fees and everything else like inspections.
The short of it is this, rent can't be based on income. If someone owns an apartment complex say in LA and they need so much money to cover expenses, they can't rent to a bunch of people only making so much money. If the government decided to say, "Hey you have to charge rent based on x." It would open a can of worms. City and state taxes would need to be adjusted. Inspection fees adjusted and so on. And that just won't happen. The more a place is worth, the more taxes the government / state gets. Which they like and won't change.
And yet, it is, and it works well, nation-wide. (Public Housing and Section 8 Housing) I'm not saying that it's problem-free, but the programs accomplish their stated goals - To help people afford...
The short of it is this, rent can't be based on income.
And yet, it is, and it works well, nation-wide. (Public Housing and Section 8 Housing) I'm not saying that it's problem-free, but the programs accomplish their stated goals - To help people afford unaffordable rents.
If the government decided to say, "Hey you have to charge rent based on x." It would open a can of worms. City and state taxes would need to be adjusted. Inspection fees adjusted and so on.
And that just won't happen. The more a place is worth, the more taxes the government / state gets. Which they like and won't change.
Really? California voluntarily (well, by voter edict) drastically capped most property taxes in 1978, and yet, we're very successful, with something like the 5th largest economy in the entire world, and the most US citizens of any state. About 11 million more than Texas, the second most populous state. https://www.californiataxdata.com/pdf/Prop13.pdf
There is something deeply broken about a society where empty houses outnumber homeless people 6 to 1. And I'm well aware that this is not exclusive to the US.
There is something deeply broken about a society where empty houses outnumber homeless people 6 to 1. And I'm well aware that this is not exclusive to the US.
The government also provides a lot more than it used to because the "free market" has proven completely unsuitable to the task in several areas. So it seems like you're being disingenuous without...
The government also provides a lot more than it used to because the "free market" has proven completely unsuitable to the task in several areas. So it seems like you're being disingenuous without including the whole picture. Also, your figure doesn't show "over half the economy".
It also doesn't mean it isn't useful. The government doesn't offer free televisions to every citizen. You could make the exact same charge against private companies. Anyone who tells you there...
It also doesn't mean it isn't useful. The government doesn't offer free televisions to every citizen. You could make the exact same charge against private companies. Anyone who tells you there isn't tons of waste in the private sector hasn't worked there long enough.
Can you provide an example of a "free market" of basically anything on a society-wide scale anywhere? We know that the government can do things effectively. It's been done in the USA and across...
Can you provide an example of a "free market" of basically anything on a society-wide scale anywhere?
We know that the government can do things effectively. It's been done in the USA and across the world. I've yet to see the vaunted "free market" in action at any useful scale. All I see is adherents pushing an ideology that hasn't ever worked in the real world.
In my opinion, it doesn't work. Every place where we (humanity) starts out, we eventually move from a free market state to a more regulated governed state. The free market has inevitable downsides...
In my opinion, it doesn't work.
Every place where we (humanity) starts out, we eventually move from a free market state to a more regulated governed state. The free market has inevitable downsides that will happen, like market faiulre. Now in theory the market will eventually correct these problems, but in the meantime all kinds of damage will happen to real people that the free market isn't going to fix.
I'm not in power, and I certainly don't want to try it. There is a reason we scrapped the articles of confederation in the United States. It's because it doesn't work for society.
Right, but if it's total tax revenues relative to gdp, that's a rate which should follow the aggregate tax rate. You can't get more in taxes as a percentage of gdp unless you increase the tax...
Right, but if it's total tax revenues relative to gdp, that's a rate which should follow the aggregate tax rate. You can't get more in taxes as a percentage of gdp unless you increase the tax rate.
As far as I am aware the aggregate tax rate has dropped since ww2 where it was massively high to support the war, and the graph does not reflect that. I'd like to see the source data to figure out whether I am wrong in my idea about tax rates or whether the graph is wrong
I'd still like to see that data. The graph here is saying the government is taking more out of the economy than when we were in a war where the entire economy was mobilized to support the...
I'd still like to see that data. The graph here is saying the government is taking more out of the economy than when we were in a war where the entire economy was mobilized to support the governments actions. It just doesn't pass the smell test to me
This seems misleading. From the start, I can see something I know is factually incorrect: Rental prices in Kansas are lower than in Missouri, not the other way around. I distrust this study.
This seems misleading. From the start, I can see something I know is factually incorrect:
Rental prices in Kansas are lower than in Missouri, not the other way around.
Yes, very much so. The Fair Market Rent seems to be based on the median. That's fairly unfair if you're going off of minimum wage. Similarly, it's a bit annoying that they're comparing a single...
Yes, very much so. The Fair Market Rent seems to be based on the median. That's fairly unfair if you're going off of minimum wage.
Similarly, it's a bit annoying that they're comparing a single minimum wage worker and the price it takes to rent a two-bedroom in the study. If there are two people, the time halves.
And above all, the fair market rate of Kansas seems drastically inflated.
They aren't cheap whatsoever. Those are like KC, KS/MO/Right By Cerner prices. No link/citation, just giving my experience as a person who's been renting in KS/MO for half a decade.
They aren't cheap whatsoever. Those are like KC, KS/MO/Right By Cerner prices.
No link/citation, just giving my experience as a person who's been renting in KS/MO for half a decade.
And the article goes back and forth between saying two bedroom rented house and two bedroom apt. There’s a big difference between the two. Also why should a single person with one minimum wage...
And the article goes back and forth between saying two bedroom rented house and two bedroom apt. There’s a big difference between the two. Also why should a single person with one minimum wage income have a two bedroom house? Maybe rent a 1 bedroom or studio apt instead.
I think a major problem is younger people looking at their parents and seeing where they are in life then expecting to have the same but at a younger age. It took years for the parents to pay off...
I think a major problem is younger people looking at their parents and seeing where they are in life then expecting to have the same but at a younger age. It took years for the parents to pay off the house, to afford the boat, to have that new car, they didn't just wake up one morning and have it.
Expectations need to be tempered, some personal responsibility needs to be accepted, and hard choices need to be made.
A long story made short, back around 2006 I lost my job and ended up homeless for several months. When I finally got a job I did not have a bank account because I did not have a mailing address yet, so I cashed my checks at a liquor store. I clawed my way back up out of the gutter by myself. Unaffordable rent? Are you kidding me? Rent is affordable, it just might not be the trendy lofts downtown or the four-bedroom dream house in a subdivision. It might require living a bit further away from where you work, or doing without that new iPhone, or not having subscriptions to every streaming service along with cable, but it can be done. I say this as a person who has had to do it themselves, from dirt broke and homeless to owning my own home. Shit, maybe I am just an outlier, but I don't think that's the case.
This seems awfully close to the whole "lift yourself up by your bootstraps" attitude, which is infamously unhelpful and unrealistic. For every person with your experience clawing your way out of...
This seems awfully close to the whole "lift yourself up by your bootstraps" attitude, which is infamously unhelpful and unrealistic. For every person with your experience clawing your way out of poverty, there are a thousand* that fail to do so.
The cited study (full report PDF here) defines the fair market rent to be "typically the 40th percentile of gross rents for standard rental units" including utilities. The author defines...
The most expensive state is Hawaii, where the fair market rent for a two-bed rental is $1,879 a month, meaning workers need to bring in $36.13 an hour for rent to be affordable. The current average hourly wage in the state is $16.16. Workers earning the minimum wage would need to work 143 hours – or 3.6 full-time jobs – a week to afford a two-bed rental.
The cited study (full report PDF here) defines the fair market rent to be "typically the 40th percentile of gross rents for standard rental units" including utilities. The author defines "affordable" to mean "not more than 30 percent of income."
Based on these assumptions, a worker bringing in $36.16 an hour works around 173 hours a month to have $1879 be 30% of their salary.
(In case you're interested, minimum wage in Hawaii is $10.10 per hour according to the Department of Labor's website. It looks like the author uses this number to calculate the number of hours worked to afford rent.)
My problem with this reasoning is that it compares the average hourly wage to the 40th percentile housing price, and that it uses a two-bedroom rental unit as the standard. It may indeed be the case that rent is becoming increasingly unaffordable in the US, but it would have helped to have data about one-bedroom units and median income.
Based on a quick search, I could only find median income data here (disclaimer: I didn't verify these numbers against the original US Census data). Based on the median household income for 2016, the affordable rental price is $1862 per month, which is right about the fair market rental value.
Why is a two-bed apartment (or "home") considered modest baseline for "someone working a 40-hour week"? And by someone do they mean literally a single person, or a family of 2? 3?
I'm not disagreeing with the sentiment, I'm paying an outrageous amount for a too-small studio, I'm just confused about the metric. Do single people really live in "modest" homes? I certainly haven't or know anyone that expects to.
That used to be considered modest, back when people were able to get houses right out of school. Maybe it's not anymore, but that's just a reflection of the decreased wealth the average worker had nowadays
That's just so bizarre to me, but I guess it must be true. I wonder when the switch in expectations started.
Well if you had any kids youd need another room. I don't think it was common for people to be rooming together unless they were family, and it used to be expected that you would have children.
There are even laws on the books limiting the number of unrelated women that could live in the same dwelling as it was assumed you must be a brothel of you had a bunch of unrelated people living together
I was going to make a similar point. My first apartment was split between four people (3 bed rooms and a make-shift fourth one). My later ones were two bedrooms split between two people.
I think that the point of the post stands but expectations are way out of whack. Advertising makes people think they're supposed to have ALL kinds of craziness, which isn't necessarily what people actually need. Needs vs wants folks.
It's not just advertisers, it's also TV shows and movies featuring people in apartments that in no way match their salary. It's not very exciting to see the adventures of people working multiple jobs to make ends meet, and cramped apartments aren't as easy to film due to how little space you have to work with.
That's why shows like Rosanne and Malcom in the Middle are so important for people to see. Heck even Al Bundy had a amazing house!
Al lived in a house with 2 kids, a dog, and a stay at home wife while working at a shoe store. How bizarre, in retrospect.
But should the average renter be at the federal minimum wage?
Why do they use the federal minimum wage instead of state minimum wages? Seems pretty biased on that front.
I've said it before, and I'll say it here as well.
As a country, the US needs to nationalize rental properties.
The continuing unaffordability of rental apartments, which has only expanded over the last several years, has led to a nationwide homeless epidemic.
It's a national shame, and I don't think it will ever be answered/fixed until the price for renting an apartment is forcibly tied to a person's income.
Of course, this brings up many things, not the least of which is angry calls of "SOCIALISM BAD!", and I agree that it's not quite that simple here.
But whatever we do, we had better do something fast, and I see no good reason that we should not all take care of the basic needs of each other.
Let people work for luxury items/better apartments/etc, but no one should ever want for the basic necessities.
Some areas are just too expensive for this. Property taxes are sky high in certain areas, and landlords / companies with rental properties have to pay them. I am in Tulsa OK and I lived in an apartment complex up until Jan 1 of 2018. The complex changed hands and I got curious about the sell price. So I dug into the property records. The taxes last year were 60k. This is Tulsa, OK. So thing about what places in LA are paying.
Some areas are just nicer and require more money for upkeep. You can't really expect someone with an apartment in a great spot like right on certain shores or right in the middle of downtown of a major city to not charge a lot for that.
If we started to say "Okay you have to charge this based on this." isn't great because we have to take into account the fees the places have to pay to operate. They have to cover those costs some how.
And I am in no means an advocate for landlords and the like. I think they have way too much power and the burden of proof on them is so low they get away with murder. Here in OK, they have to give you notice before they enter. But you don't have to see or even know the notice exists. So they can enter your apartment without notice, and then say oh we totally put it on your door - the wind must have blown it off and that be legally acceptable because the burden of proof is so low and the the tenant really doesn't have any way to fight unless you have a camera shooting your door from the outside 24/7.
I never said that there wouldn't be problems. :-)
Yet, I can provide a counterpoint to your story. I live in CA. We have, as far as I know, the highest rental prices in the entire country, beating out even New York City.
Yet, through government assistance, I pay a fixed percentage of my income for a pretty nice apartment, which is quite large for one person, considering the overall cramped nature of the city. The complex is managed by a non-profit, and the property taxes get paid just fine.
Of course, I live in a nasty neighborhood, but we can't have everything.
That is a major part of the reason though. Not every complex is owned by a non profit. Imagine having to come up with 60k a year just for the base taxes. That doesn't include all fees and everything else like inspections.
Having the complex be managed by a non-profit isn't some kind of silver bullet as you seem to allude to as far as property tax payments.
That isn't what I am saying... A non profit has much much different priorities than a privately owned rental property. Saying that a loft apartment right in the heart of Nashville or a place in Manhattan should have it's rent based on your income is just short sighted in my opinion. That just won't ever happen.
I never mentioned any other "priorities" other than property taxes, which you brought up. I'd like to keep focused on that, since that is your concern.
But that isn't my only concern. I stated other things..
The short of it is this, rent can't be based on income. If someone owns an apartment complex say in LA and they need so much money to cover expenses, they can't rent to a bunch of people only making so much money. If the government decided to say, "Hey you have to charge rent based on x." It would open a can of worms. City and state taxes would need to be adjusted. Inspection fees adjusted and so on. And that just won't happen. The more a place is worth, the more taxes the government / state gets. Which they like and won't change.
And yet, it is, and it works well, nation-wide. (Public Housing and Section 8 Housing) I'm not saying that it's problem-free, but the programs accomplish their stated goals - To help people afford unaffordable rents.
Really? California voluntarily (well, by voter edict) drastically capped most property taxes in 1978, and yet, we're very successful, with something like the 5th largest economy in the entire world, and the most US citizens of any state. About 11 million more than Texas, the second most populous state. https://www.californiataxdata.com/pdf/Prop13.pdf
There is something deeply broken about a society where empty houses outnumber homeless people 6 to 1. And I'm well aware that this is not exclusive to the US.
I don't follow how the image you linked has anything to do with your statement. Can you help me understand?
Thank you! I better understand your point now, but I think it's not the core reason (but certainly one of many reasons!)
The government also provides a lot more than it used to because the "free market" has proven completely unsuitable to the task in several areas. So it seems like you're being disingenuous without including the whole picture. Also, your figure doesn't show "over half the economy".
It also doesn't mean it isn't useful. The government doesn't offer free televisions to every citizen. You could make the exact same charge against private companies. Anyone who tells you there isn't tons of waste in the private sector hasn't worked there long enough.
I'd still give the free market the benefit of the doubt, since we don't have one in the US anyway.
Can you provide an example of a "free market" of basically anything on a society-wide scale anywhere?
We know that the government can do things effectively. It's been done in the USA and across the world. I've yet to see the vaunted "free market" in action at any useful scale. All I see is adherents pushing an ideology that hasn't ever worked in the real world.
Is that because it doesn't work, or because nobody in power wants to try it?
In my opinion, it doesn't work.
Every place where we (humanity) starts out, we eventually move from a free market state to a more regulated governed state. The free market has inevitable downsides that will happen, like market faiulre. Now in theory the market will eventually correct these problems, but in the meantime all kinds of damage will happen to real people that the free market isn't going to fix.
I'm not in power, and I certainly don't want to try it. There is a reason we scrapped the articles of confederation in the United States. It's because it doesn't work for society.
Tax rates have come down considerably since ww2 and this graph does not reflect that. Where is the data for this graph coming from?
Right, but if it's total tax revenues relative to gdp, that's a rate which should follow the aggregate tax rate. You can't get more in taxes as a percentage of gdp unless you increase the tax rate.
As far as I am aware the aggregate tax rate has dropped since ww2 where it was massively high to support the war, and the graph does not reflect that. I'd like to see the source data to figure out whether I am wrong in my idea about tax rates or whether the graph is wrong
I'd still like to see that data. The graph here is saying the government is taking more out of the economy than when we were in a war where the entire economy was mobilized to support the governments actions. It just doesn't pass the smell test to me
This seems misleading. From the start, I can see something I know is factually incorrect:
Rental prices in Kansas are lower than in Missouri, not the other way around.
I distrust this study.
Yes, very much so. The Fair Market Rent seems to be based on the median. That's fairly unfair if you're going off of minimum wage.
Similarly, it's a bit annoying that they're comparing a single minimum wage worker and the price it takes to rent a two-bedroom in the study. If there are two people, the time halves.
And above all, the fair market rate of Kansas seems drastically inflated.
They aren't cheap whatsoever. Those are like KC, KS/MO/Right By Cerner prices.
No link/citation, just giving my experience as a person who's been renting in KS/MO for half a decade.
That's the thing, right? Averages don't work when you're comparing the minimum wage to average housing prices.
And the article goes back and forth between saying two bedroom rented house and two bedroom apt. There’s a big difference between the two. Also why should a single person with one minimum wage income have a two bedroom house? Maybe rent a 1 bedroom or studio apt instead.
Exactly!
I think a major problem is younger people looking at their parents and seeing where they are in life then expecting to have the same but at a younger age. It took years for the parents to pay off the house, to afford the boat, to have that new car, they didn't just wake up one morning and have it.
Expectations need to be tempered, some personal responsibility needs to be accepted, and hard choices need to be made.
A long story made short, back around 2006 I lost my job and ended up homeless for several months. When I finally got a job I did not have a bank account because I did not have a mailing address yet, so I cashed my checks at a liquor store. I clawed my way back up out of the gutter by myself. Unaffordable rent? Are you kidding me? Rent is affordable, it just might not be the trendy lofts downtown or the four-bedroom dream house in a subdivision. It might require living a bit further away from where you work, or doing without that new iPhone, or not having subscriptions to every streaming service along with cable, but it can be done. I say this as a person who has had to do it themselves, from dirt broke and homeless to owning my own home. Shit, maybe I am just an outlier, but I don't think that's the case.
This seems awfully close to the whole "lift yourself up by your bootstraps" attitude, which is infamously unhelpful and unrealistic. For every person with your experience clawing your way out of poverty, there are a thousand* that fail to do so.
*Hyperbolically speaking.
The cited study (full report PDF here) defines the fair market rent to be "typically the 40th percentile of gross rents for standard rental units" including utilities. The author defines "affordable" to mean "not more than 30 percent of income."
Based on these assumptions, a worker bringing in $36.16 an hour works around 173 hours a month to have $1879 be 30% of their salary.
(In case you're interested, minimum wage in Hawaii is $10.10 per hour according to the Department of Labor's website. It looks like the author uses this number to calculate the number of hours worked to afford rent.)
My problem with this reasoning is that it compares the average hourly wage to the 40th percentile housing price, and that it uses a two-bedroom rental unit as the standard. It may indeed be the case that rent is becoming increasingly unaffordable in the US, but it would have helped to have data about one-bedroom units and median income.
Based on a quick search, I could only find median income data here (disclaimer: I didn't verify these numbers against the original US Census data). Based on the median household income for 2016, the affordable rental price is $1862 per month, which is right about the fair market rental value.