Affordable Housing & Minimum Wage

What is Affordable Housing? Affordable: able to afford and still have money for food, healthcare, transportation, etc. Housing: providing of shelter that is safe, decent. Single family home Townhouse Condo Apartment Affordable Housing: a housing cost that doesn’t exceed 30% of a households gross income. Gross income: income before deductions

According to the US Department of Housing and Urban Development, “an estimated 12 million renter and homeowner households now pay more than 50 percent of their annual incomes for housing. A family with one full-time worker earning the minimum wage cannot afford the local fair-market rent for a two-bedroom apartment anywhere in the United States.”

Let’s Analyze Chicago’s Housing… Median single family home price in Chicago for 2015 was $265,000. Using a mortgage calculator (https://www.zillow.com/mortgage-calculator/) with a current interest rate of 4%, 30 year loan with 10% down payment and property tax…monthly payment would be $1588. If the monthly payment is $1588 (part), we can substitute into the formula below to determine what a person’s monthly salary (whole) would need to be to be able to afford (30% of salary)living in Chicago. 1588 x 30% 100 x = $5293 =

What does this mean? x = $5293 This means that a family’s monthly income would need to be at least $5293. It would take 530 minimum wage ($10/hour) hours per month to be able to pay for this home….that is 132 minimum wage hours each week! Therefore, in Chicago, even if you have two adults working full-time (40 hours), they would not be able to afford to own a home.

Des Moines, Iowa Down payment Amount: ____________ Median Home Price: $186, 700 Down Payment: 10% Interest Rate 4% Using https://www.zillow.com/mortgage-calculator/ to find mortgage and the following information. Down payment Amount: ____________ Monthly Mortgage ________________ Monthly Salary Needed ____________ Minimum Wage Hours Monthly _______ Minimum Wage Hours Weekly _______ Can a family with two minimum wage workers afford to live in this city? _____ ________________________________

Recommended Budget Percentages

Minimum Wage Budget A family with 2 minimum wage workers: Budget Income: $3200 Budget Housing: ___________________ Transportation: ______________ Food: _____________________ Savings: ___________________ Utilities: ___________________ Medical/Health: ____________ Personal: __________________ Recreation: ________________ Debt: _____________________