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Why 222,000 Chicagoland renters cannot buy homes

by Peter Thomas Ricci

chicago-homeowners-realtytrac-home-sales-report-2015-q3

Earlier this week, we reported on the sobering findings of the Joint Center of Housing Studies’ latest report, which found that millions of households in America are struggling with housing costs, much to the detriment of housing markets across the country.

That housing crisis particularly apparent here in Chicagoland, where more than 222,000 renters face cost burdens, meaning they devote more than a third of their monthly income to housing; even worse, among low-income renters who make $15,000 or less, an incredible 75.5 percent face severe cost burdens, meaning they devote more than half of their income to housing.

America’s housing plight in 2016

As we have long documented, the mixture of rising costs and slowing (if not falling) earnings have wreaked havoc on housing affordability, despite the conventional wisdom, rising rents do not incentivize consumers to buy homes; rather, they negatively impact consumer savings and render homeownership further out of reach.

Housing is still moving forward – here in Chicagoland, home sales were up 9.3 percent last month – but the Joint Center’s numbers clearly show that a huge swath of American households are unable to participate in that growing marketplace, and such inequities could very well harm housing’s future prospects.

Metro Area Share of Low-Income Renters with Severe Cost Burdens Number of Renter Households with Cost Burdens Renter Median Monthly Housing Costs
Atlanta 80.7% 122,300 $790
Boston 62% 108,600 $660
Chicago 75.5% 222,600 $770
Dallas 83.5% 163,000 $730
Houston 79.5% 140,200 $720
Los Angeles 82.4% 342,400 $980
Miami 79.6% 157,400 $870
New York 73.2% 584,700 $890
Phoenix 81.4% 107,000 $750
San Francisco 69.3% 96,400 $880
Seattle 71.8% 78,000 $800

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Comments

  • John says:

    With politicians raising property taxes to the extreme, rental price increases are soon to follow. As a landlord myself, I know that this tax increase will unfortunately have to trickle down to the tenant. The graph above will look significantly different in 24 months. As a homeowner I feel taken advantage of with my tax homes new tax bill that went up $6,000?! I can’t imagine how bad it would feel to be in a renters position and have no control to appeal the increase.

  • Floria Christine says:

    More people are working minimum wage jobs that will not even give full time status. Years of working regular 39 hours cannot get loan because they are not considered full time ..Worlds largest employer world largest offender.

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