Black & Hispanics Spend Nearly Half of Income On Rent
By News One
Stagnant wages and increasing rents are creating a housing affordability crisis for scores of Black and Hispanic families, reports Fortune magazine.
Based on a new report from Zillow, residents of predominantly Black communities paid about 44 percent of their income on rent in 2016—that’s up from 40 percent in 2011.
In Hispanic communities, rent consumes about 48 percent of income, compared to 41 percent five years ago.
That represents a significant housing affordability gap in comparison to those living in predominantly White communities, where residents pay closer to the recommended 30 percent of gross income on housing.
Boston has one of the largest housing affordability gaps. Rents consume about 71 percent of income in Black neighborhoods but just 35 percent in White communities.
Skylar Olsen, a senior economist for Zillow, told Fortune that stagnant wage growth is the main cause of the affordability crisis. Since 2011, wages have increased about 2.9 percent in Black neighborhoods but 5.4 percent in White communities.
Consequently, families stuck in low-income communities are unlikely to move out of public housing. If this trend continues, it will be impossible for them to save enough to purchase a home, save for retirement or put money away for emergencies.