1 in 5 spend half of income on housing

Rising rates, joblessness and declining wages are prompting the problem.

Housing costs are considered affordable at 30 percent or less of income. But rising rental rates, high unemployment and declining wages prompted roughly 323,000 of 1.7 million low- to moderate-income households in Ohio to spend an additional 20 percent or more of their income on housing and utilities, according to the Center for Housing Policy, the research arm of the National Housing Conference in Washington, D.C. Tthe most recent Census data available was used for the report.

Nationally, nearly 24 percent of such households spent half or more of their income on housing costs in 2010, the center said.

“Affordable housing is important to the local economy because without affordable housing, people cut corners and there’s no demand for anything else,” said Blake Warenik, spokesman for the center. “There’s a lot of economic repercussions to somebody spending so much on housing.”

Demand for apartments, townhouses and other rental property is greater than the supply thanks in part to foreclosures and high unemployment, which pushes many people out of their homes, said Laura Williams, the report’s author. Rental rates rise as a result.

Median home sales prices dropped from $95,000 in the last part of 2009 to $92,000 in the third quarter of 2011.

During the same time, the cost to rent a two-bedroom apartment in Dayton increased from $687 to $714 a month, according to the center.

Even though home prices fell, incomes fell faster, limiting a person’s ability to purchase housing.

For “a lot of people that have been going through financial problems, renting is a better option for them right now,” Williams said.

Deborah Ferguson, director of outreach and social services for Community Action Partnership of the Greater Dayton Area, said it’s common for Community Action’s low-income rent clients to make $650 a month and pay $525 for rent, she said.

“The plight of the renter given our terrible economy has not really been highlighted or focused upon,” Ferguson said. “These are people who are at an income level that would normally qualify for subsidized housing.”

Joanna Lindberg, executive director of Greater Dayton Apartment Association, challenged some of the center’s findings.

She said rents are slowly rising, but there was no overall rush in the area to rent apartments due to the housing crisis. That can be attributed in part to the region’s declining population, she said.

Occupancy rates for efficiencies, apartments and townhouses increased to about 93 percent in the third quarter 2011, compared to 90 percent the same quarter in 2009, according to the apartment association.

“I think there’s a perception out there due to foreclosures people are going to rent, but that’s not been the case. Most of those folks are either going back and living with other family members, doubling up,” Lindberg said. “They may be going into a rental home.”

Contact this reporter at (513) 705-2551 or clevingston@coxohio.com.

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