Arizona minimum wage earners must work this many hours to afford rent
To afford a two-bedroom apartment in Arizona, a renter needs to make almost $30 an hour. Too many don’t.
That hourly wage adds up to an annual salary of $62,000. Someone making the state’s minimum wage of $13.85 would have to work at least 80 hours a week job to earn that much.
Most metro Phoenix retail and restaurant workers, teachers, construction workers and firefighters can’t afford a two-bedroom, according to an analysis from Scottsdale-based economic and real estate consulting firm Elliott D. Pollack and Co.
Slightly lower home prices and rents aren’t offsetting inflation and higher interest rates.
Arizona climbed from the state with the 18th highest “housing wage” needed to rent a twobedroom apartment in 2022 to number 12 this year, according to the National Low Income Housing Coalition’s latest “Out of Reach” report.
The coalition defines its “housing wage” as an estimate of “the hourly wage a full-time worker must earn to afford a modest rental home” at a fair market rent “without spending more than 30% of their income on housing costs.” Capping housing spending at 30% of income is a commonly accepted measure of affordability.
“Arizonans deserve a safe and affordable place to live,” said Arizona Department of Housing Director Joan Serviss.
She is co-chair of the Governor’s Interagency and Community Council on Homelessness and
Housing, which met for the first time in June.
Serviss said the council’s goal is to find quick solutions to tackle Arizona’s housing affordability and homelessness crisis.
Not making enough to afford a home
The average Arizona renter wage is almost $23 an hour, making rent of almost $1,200 a month affordable, according to the National Low Income Housing Coalition. That’s based on people spending no more than 30% of their income on housing.
But the fair market two-bedroom apartment rent in Arizona is about $1,560.
A fair market one-bedroom in Arizona costs tenants $1,290 a month, meaning a renter making the state’s minimum wage would have to work about 71 hours a week to afford it.
Last week, hundreds of housing advocates met in Tucson and talked about how to build more much-needed affordable housing at the annual Arizona Housing Forum.
The housing affordability problem is worse in metro Phoenix than in the state as a whole because of higher rents. The average hourly wage needed to afford a two-bedroom apartment in
the Phoenix area is $33.50. The average renter wage in the region, though, is $24.20 an hour.
It’s also much tougher to buy a Phoenix-area house. Only 30% of the homes sold in the Valley in this year’s second quarter were affordable for households earning the area’s median income.
At the beginning of 2021, the share of homes for sale in the metro Phoenix area that were affordable for median-income households was more than double that — almost 63%, according to the Housing Opportunity Index from the National Association of Home Builders and Wells Fargo.
Mortgage rates climbing above 7% are making it tougher.
Living paycheck to paycheck
Nurses, police officers, firefighters, teachers, service workers and construction workers can’t afford to buy in metro Phoenix’s 11 largest cities, according to Elliott D. Pollack and Co.
Earlier this month, a construction worker who missed one month of rent on a north Phoenix apartment was facing eviction. The 56-year-old shot himself after Maricopa County constables knocked on his door to evict him, according to police.
It was the only time he missed rent at the apartment, according to court records. And at his hearing, the man said it only happened because somebody was late paying him.
He owed his landlord about $1,440. Landlords moved to evict more metro Phoenix renters in July than any month since the Great Recession. Last month, 7,142 eviction cases were filed, according to the Maricopa County Justice Courts.
While Valley rents have dipped slightly from last summer, tenants are still dealing with a more than 25% increase since 2020.
If you are facing eviction or know someone who is, many resources can be found at https://azevictionhelp.org/. Free mental health resources are available to anyone in Arizona. A statewide mental health crisis line is available at 844-534-HOPE (4673). Another resource for 24/7 help is to dial 988.
To find ways to help more struggling tenants, next month Arizona housing advocates are bringing in eviction diversion experts from other cities that have had good results from their programs.
Tackling Arizona’s housing problem
Apartment owners and managers are joining a move to fund more housing people can afford.
The Arizona Multihousing Association is launching a donation program with the Arizona Housing Fund. Landlords that participate will donate $5 for every lease application. Residents can also round up their monthly rent to donate.
“We have far too many people in our state who are living unhoused,” said Tim Sprague, advisor to the housing fund and apartment developer. “The multifamily industry is in the business of housing.”
The annual state housing forum in Tucson was sold out, another sign of how important affordability issues are for so many now.
Arizona allocated $230 million in funds for affordable housing, shelter and services in this year’s budget. That’s the biggest amount in state history.
Gov. Katie Hobbs’ Interagency and Community Council on Homelessness and Housing, relaunched after it was shut down during former Gov. Doug Ducey’s tenure, meets again next month.
The members range from the head of the Department of Economic Security to elected officials, representatives from the Maricopa Association of Governments and nonprofits big and small from across Arizona.
I was at the first meeting and listened to each member of the council talk, often emotionally, about housing affordability and homelessness problems they are seeing and the people they are trying to help.
I left feeling this is a group that can get things done to help the many people struggling to afford a roof over their heads across the state.