STATE HOUSING CRISIS
In South Carolina, a household earning $15,853 is considered to be extremely low. This income level can afford a monthly rent of $396, while the Fair Market Rent for a 2-bedroom unit is $548, according to the National Low Income Housing Coalition, 2003.
A minimum wage earner can afford a monthly rent of no more then $268. Therefore, in South Carolina a minimum wage worker must work 82 hours per week in order to afford a 2-bedroom apartment. The hourly wage a South Carolinian full time worker must make to afford a 2-bedroom apartment at the area’s Fair Market rent is $10.53, 205% over minimum wage.
In South Carolina the average renter annual income is $28,178. This means that the income percent needed to afford a 2-bedroom apartment would be 78% of their income. The percent of renters in South Carolina unable to afford a 2-bedroom apartment is 39%.
NATIONAL CRISIS
Everyone needs housing- a place to live, a place to call home. It is the essence of the American Dream. Housing is one of society’s most basic human need, next to food and water. But the realization of safe decent, affordable housing is becoming increasingly difficult for a large portion of the population to achieve. Recent studies have shown that some 95 Million United State residents are facing severe housing cost burden or are living in crowded or inadequate conditions.
Housing prices have appreciated over 70% since 1995. House values increased 12.5% between 2004 and 2005. One of the consequences of these rapidly escalating house values is that housing affordability is at 25-year low. In 37 states, homes prices are growing faster than per capita income, creating a larger gap between what people earn and what they can afford.
The National Low Income Housing Coalition recently found that in order to afford a market-rate two-bedroom rental unit without spending more than 30% of annual income, a full-time worker would need to make $15.21 per hour. The federal minimum wage is $5.15 per hour. (Out of Reach Study, NLIHC 2005)
Housing affordability problems continue to escalate up the income ladder while federal subsidies are on the decline, not to mention much of these subsidies cannot serve the more middle-income needs of the community. The combination of escalating housing prices, stagnant incomes and declining federal funds continues to challenge the nation’s ability to provide affordable housing.
NATIONAL SOLUTIONS
Reduction of federal support for housing, has forced local and state governments to step up and fill the gap using a variety of tools to meet the demand for affordable housing including:
• Developing housing trust funds- provide dedicated public funds for the production of affordable housing and help leverage private capital for housing developments.
• Implementing inclusionary zoning ordinances- which either mandates or encourages developers to construct affordable units as part of new developments.
• Use of modular housing as an alternative to on-site stick built homes.
• Promotion of accessory dwellings, higher densities, infill development and creative reuse of existing structures have also helped to increase choices in housing affordability.
• Developing public/private partnerships both from the finance side and the development side.
“Each community is different, and you need to focus on local needs and opportunities, you’re not going to find the perfect land for a nickel. Abandoned lots, buildings that are not complying with code or old warehouses can all be developed into mixed-income housing to the benefit of the community.” (John Stewart, John Stewart Company, private developer.)
“You can give up the idea that you’re going to fund the project from one source or one grant. An affordable housing development often requires six or seven layers of financing, from both public and private….partnerships are the name of the game. None of us can tackle the challenge of building affordable housing alone.” says Stewart. ( Community Investments, Affordable Housing in High Cost Areas, Carolina Reid. September 2005.)
