The lack of affordable housing is one of our nation’s most urgent crises. In Texas, we are witnessing a microcosm of how these easily addressable problems can manifest into emergencies on a massive scale in a new report.
Out Of Reach is a report from the National Low Income Housing Coalition which highlights the gulf between the wages people earn and the price of decent rental housing in every state, metropolitan area, and county in the United States. They quantify this by calculating a “Housing Wage,” which is the hourly wage a full-time worker must earn to afford a modest rental home without spending more than 30% of their income on housing costs based on the U.S. Department of Housing and Urban Development’s (HUD) fair market rent.
Nationally, the Housing Wage is 2024 is $32.11 for a modest two-bedroom apartment. Texas ranks right near the middle of all 50 states, Washington D.C. and Puerto Rico with a housing wage of $27.88 for a modest two-bedroom apartment. However, there is no county in the entire United States where a minimum-wage worker working full-time can afford a modest two-bedroom apartment at fair market rent (not including Puerto Rico). And in only 204 counties can a full-time minimum-wage worker afford even a one-bedroom apartment at fair market rent.
Though, these are statewide figures; when we focus on certain metropolitan areas, housing becomes more costly. In Fort Worth-Arlington, the housing wage is $31.10, in Dallas it becomes $33.81, and in Austin-Round Rock the housing wage shoots up to $37.00.
In Texas, the minimum wage is the federal minimum of $7.25. This means for a tenant to afford a 2 bedroom apartment at Fair Market Rent, a worker would have to work 154 hours per week or have 3.8 full time jobs. Texas is the third worst state in the nation with the hours necessary to afford a 2 bedroom home at fair market rent, due to the combination of high costs and having the federal minimum wage.
There are a number of factors that contribute to these high numbers. Nearly 2 out of 5 Texans are renters or 3,944,826 renter households. Five of the most common occupations in the U.S. are low-wage occupations: retail sales, food and beverage services, food preparation, home health and personal care services, and building cleaning. In fact, 14 of the nation’s 20 most common occupations pay median wages that are less than what a full-time worker needs to afford a modest one-bedroom rental home at the national average fair market rent. Sixty-four million people, or 42% of the entire workforce, work in these 14 occupations.
These problems do not exist in a vacuum either. Black and Latino populations experience precarious wage and housing issues more than their respective white counterparts. Nationally, the median wage of a white worker is just 26 cents less than the Housing Wage for a one-bedroom apartment, while the median wage of Black workers falls $6.24 short and the median wage of Latino workers falls $6.42 short. These numbers also split across gender lines. For example: Other research has shown that Native American women are paid significantly less than white men in every state, earning just 59 cents for every dollar paid to a white man nationally. Additionally, the average annual unemployment rate among white participants in the labor market was 3.3% in 2023, compared to 4.6% for Hispanics or Latinos, 5.5% for Blacks, and 6.6% for American Indians or Alaska Natives, per the U.S. Bureau of Labor Statistics.
Some may suggest that simply raising the minimum wage could solve these problems, but that must be one solution among many. We must note the fact that average and higher wage workers can often choose to live in housing that is affordable only to lower-wage workers. We must also consider those who are unable to work due to disability or other factors, who are supported by Supplemental Security Income (SSI) or other subsidies, also experience a shortage of affordable housing. In Texas, the rent that is affordable to SSI recipients is $283. Wage increases cannot solve this problem alone.
We must have an expansion of affordable housing, voucher programs and laws to protect those who use them, and resources such as emergency rental assistance to ensure the stability of the millions of tenants in Texas.
You can read more about what Out of Reach tells us about low-wage workers, renters, and the solution to ensure affordable housing is available to everyone on NLIHC’s Out of Reach homepage or read the full report below.
