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News/Events

Kentucky’s Rents Rise While Wages Fall

For Immediate Release

Charla Jackson Peter

May 14, 2010

(502) 564-7630, ext. 454

Kentucky’s Rents Rise While Wages Fall

The recent economic crisis has impacted all Americans and caused prices to increase and wages to decrease.  A family needs to earn $18.44 per hour, or nearly $38,360 a year, to afford a modest rental home in the United States, according to the National Low Income Housing Coalition’s Out of Reach 2010 report, released April 21, 2010.  Despite the recession, the report finds that rents continue to rise, while wages continue to fall across the country.  The estimated average wage for renters in the United States this year is only $14.44, a decline from $14.69 in 2009.

The amount a person working full-time must earn per hour to afford Fair Market Rent (FMR) on a two-bedroom unit is known as the Housing Wage, and the Out of Reach report calculates this wage for every state, metropolitan area, non-metropolitan area, and county in the country.  The report also calculates how many hours someone must work at the minimum and average renter wages in an area to afford typical rents and provides local wage and income data for comparison purposes.

According to Out of Reach 2010, the national average for two-bedroom FMR is $959 a month.  Also, 74 percent of metropolitan renters live in areas where two full-time jobs at minimum wage still would not provide enough income to afford the two-bedroom FMR.  For those earning minimum wage of $7.25 per hour, the annual income is only $15,080, and a household would have to work 102 hours each week to afford the nation’s average FMR for a two-bedroom home.  There is no county in the United States in which a full-time minimum wage worker can afford even a one-bedroom apartment at the FMR.

In Kentucky, a family must earn $12.19 per hour or $25,352 a year to afford a modest rental home, while the average wage in Kentucky is $10.91.  To afford Kentucky’s FMR at the average wage, a renter must work 45 hours per week, all year. 

“While our housing wage is not as alarming as other states’, it demonstrates the need for affordable rental housing,” said Richard L. McQuady, chief executive officer of Kentucky Housing Corporation.  “This report illustrates the wide gap between what is needed and what is truly attained.”

Below are examples of required wages to afford a two-bedroom apartment at FMR in various counties in Kentucky:

County     Housing Wage Median Rent
Fayette County $14.02 $729
Franklin County $13.42 $698
Louisville/Jefferson County $13.15 $684
Owensboro/Daviess County $11.67 $607
Pike County $9.98 $519

Extensive data for every state, metropolitan area, and county in the country are available on the National Low Income Housing Coalition’s Web site, www.nlihc.org/oor2010/.  Ranking tables and maps are also available, as is further analysis and explanation of the data.

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Kentucky Housing Corporation - 1231 Louisville Road - Frankfort - Ky 40601-6191
www.kyhousing.org

Kentucky Housing Corporation, the state housing finance agency, was created by the 1972 General Assembly to provide affordable housing opportunities. As a self-supporting, public corporation, Kentucky Housing offers lower-than-market rate home mortgages, housing production financing, homeownership education/counseling, rental assistance, housing rehabilitation and supportive housing programs for special needs populations.
Kentucky Housing Corporation prohibits discrimination in employment based on race, color, religion, sex, national origin, sexual orientation, gender identity, ancestry, age, disability or veteran status.