2022 vs 2018: Oregon County Differences on Rent Affordability Resulting From Increasing Average Wages AND Increasing HUD Fair Market Rents.

The National Low Income Housing Coalition publishes an annual Out of Reach report that has detailed information on the affordability of rental units for minimum wage households and for rental households. I anticipate their annual publication will be arriving in early summer.  

I though it would be useful to create a different comparison at the Oregon county level of affordability using the annual average weekly wage as published by the Oregon Employment Department and the US Department of Labor. 

The average weekly wage is higher than the minimum wage. Even though it is calculated per worker and not per household it could also be higher than the NLIHC projected median rental household income level. If so, the average weekly wage would show greater renter affordability compared to both those indices. 

I created an EXCEL spreadsheet HERE (and embedded below) that allows users to select up to 5 Oregon counties for a side by side comparison to see average wage and HUD FMR rent values and changes from 2018 to 2022.   

The spreadsheet shows 

• Average weekly wages (assuming full time employment, and is person based and not household based).
• HUD 1 BR FMR
• HUD 2 BR FRM
• Changes in average weekly wages
• Changes in HUD 1 BR and 2 BR FMR
• The share of income required to make a 1 or 2 BR rental affordable.
• The weekly hours required to make a 1 or 2 BR rental affordable. 

The 5 Oregon counties in the Portland metro area are the default county selections. (To make alternative county selections you may need to download the file instead of viewing it via your browser).  

Observations: 

Using Multnomah county as an example. 

1. The average weekly wage increased by 26%, but the HUD 1 BR FMR increased at a faster rate, by 42%,  and the 2 BR FMR also increased at a faster 39% rate.
2. The share of average weekly wages required for a 2 BR unit increased from 29% from 27%, and the share required to make a 1 BR unit affordable increased from 23% to 26%. While the share of income required has increased for both 1 and 2 bedroom units at HUD's FMR they both remain affordable at the average weekly wage in 2022.  
3. At the average weekly wage the hours required to make a 2 BR unit affordable increased by 35 to 39, and the hours required to make a 1 BR unit affordable increased by 30 to 34. Again, while the hours required increased for both 2 BR and 1 BR units, the hours required to pay the 1 and 2 BR HUD FMR remain below full time employment at 40 hours a week. 
4. IF you look at Clackamas county you will see that rent affordability is generally worse than in Multnomah county as their average weekly wage is BELOW that of Multnomah county. This is also true of Columbia and Yamhill counties. 
5. Conversely, the higher average weekly wage in Washington county means that generally renter affordability for average wage earners is better than in the other 3 Oregon counties in the Portland metro area. (I took a glance at Clark county in Washington and their 2022 average weekly wage and rent affordability is about the same as Clackamas county). 

Originally created and posted on the Oregon Housing Blog. 

 

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