Report: Affordable housing is out of reach for most NH renters

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Report: Affordable housing is out of reach for most NH renters

A New Hampshire resident would have to work 165 hours a week at minimum wage to afford rent on a fair market two-bedroom apartment, according to the National Low Income Housing Coalition.

The coalition’s annual Out of Reach Report, which analyzes what people must earn to afford rental housing in the U.S., ranks New Hampshire the 13th most expensive state for renters, with a $29.86 hourly wage needed to afford a two-bedroom apartment at $1,553 a month [the state’s average fair market rental rate for that size apartment]. That means an annual salary of $62,109, when the state’s renters, who make up 28% of New Hampshire households, make an average of $42,848.

The coalition determines a Housing Wage for every state, the amont a household need to pay rent and utilities while not exceeding 30% of gross income. Nationally, the Housing Wage for a two-bedroom apartment is slightly lower than New Hampshire’s, at $28.58.

“The harm caused by rapid rent increases has taken a toll on low-income renters. Even amid slowing rent growth, renters are facing the effects of a long-standing trend in which rents have risen faster than wages,” the report, released Wednesday, says. 

Nationally, nearly 50% of wage earners can’t afford a modest one-bedroom rental home at the fair market rent while working one full-time job, according to the report. At least 60% of wage earners can’t afford a modest two-bedroom rental while working one full-time job.

“Even among those fortunate enough to have found relatively affordable homes, low-wage renters are often only one missed paycheck or unexpected expense away from not being able to pay their rent. Affordable housing is a prerequisite for basic well-being, and no person should live in danger of losing their home.”

To not be considered housing cost-burdened, rent and utilities should not exceed 30% of a household’s gross income, according to federal guidelines. Households that pay more than 50% of income for housing are considered severely housing cost-burdened. The report’s findings are in line with research over the years that has found the lower a person’s income, the more housing cost-burdened they are.

And, according to the report, that trend is getting worse.

Nationally, 20.8 million renter households are housing cost-burdened, and 11.3 million are severely housing cost-burdened, according to the report. More than a quarter – 26% – of all renters are severely cost-burdened, as are 73% of households considered extremely low income [either below federal poverty guideline or earning 30% of area median income, whichever is greater].

NH housing crisis

The report is the latest to underline New Hampshire’s housing crisis. The New Hampshire Association of Realtors monthly single-family home market report for May found that the state had an all-time low 66 on the affordability index for buying a home in May, meaning that the median income is 66% of what is needed to buy a median-priced home.

Last year’s Residential Rental Cost Survey Report determined it would take years to provide enough affordable rental housing to meet the state’s needs. A growing number of the state’s renters are not only paying more than they can afford in rent, but many are being booted out of apartments and having to find accommodations in hotel rooms or other temporary housing, Ink Link has reported.

While finding housing is difficult for everyone in New Hampshire, the more money a resident makes, the more likely they are to find an affordable, available rental home.

While the state’s 2023 median household income is $120,228, New Hampshire’s 153,349 renting households [28% of the state’s households] make much less. The median renter household income is $54,558.

About 24% of households that rent in the state make 30% or less of the state’s median income, $36,068 a year, which is considered extremely low income by federal guidelines; 44% make 50% or less, $60,144 a year.

Of the extremely low-income renters, 66% pay 50% or more for housing and 77% pay more than 30%.  There are 20,358 fewer units than what’s available that extremely low-income renters in the state can afford, according to the report. There were 38 rental affordable rental units available for every 100 extremely low income New Hampshire renter when the report’s statistics were tabulated; there were 67 for those at 50% of the median income; 101 for those at 80% and 103 for those at 100%.

A renter making New Hampshire’s minimum wage of $7.25 (the federal minimum), working 40 hours a week, can afford $377 for rent at the 30% affordability cap, according to the report. About 11,000 of the state’s employed individuals make minimum wage or below, most of them tipped workers, and about 144,000 (21% of the state’s workforce) make less than $15 per hour, Business NH reported.

A household at 30% of the state’s median income can afford $902 in rent a month; someone at 50% can afford $1,503.

The pay-housing gap widens 

Nearly 50% of workers nationwide earn an hourly wage that is less than the national one-bedroom Housing Wage of $23.67.

Nationally, one-third of the workforce are in jobs that pay median wages less than what a full-time worker needs to afford a modest one-bedroom apartment. 

The report lists 19 professions in New Hampshire, comprising about 178,610 workers, that make less than the Houusing Wage of $23.05 needed for a one-bedroom apartment. The pay rates range from a median $13.99 for fast food and counter workers (about 13,300) to $22.82 for office clerks, and other general office workers (about 15,700).

More than 25 million people in the U.S. work in the five lowest-paying occupations – retail sales, food and beverage services, food preparation, home health and personal care services, and building cleaning. Those jobs have median hourly wages at least $7.80 less than the one-bedroom Housing Wage.

Rents have skyrocketed and wage increases haven’t kept up. Between 2001 and 2021 nationally, median rents increased 17.9% in the U.S., while median household income increased by 3.2%.

While wages for workers in the bottom 10th percentile increased 9% from 2019 to 2021 – the highest increase for any income group – that meant an hourly wage of only $12.57, an increase of $1.04 an hour. 

It is “a level of growth that cannot make up for the significant gap between rent and wages,” the report says.

COVID-era temporary policy changes included $46 billion in emergency rental assistance, a national eviction moratorium, increases to unemployment insurance, Supplemental Nutrition Assistance Program benefits, and childcare tax credits – all of which helped keep low and middle-income renters afloat.

Most of the programs are over, and it’s escalated the housing crisis. “Low-income renters are once again facing high rents and increased housing instability, with eviction filing rates reaching or surpassing pre-pandemic levels,” the report says. The effects of the temporary programs ending includes a spike in homelessness in many communities across the nation.

The report also found that race discrimination and race-based wage disparities increase the housing cost-burden.

“People of color are disproportionately impacted by the gap between low wages and high rents because they disproportionately work in low-wage jobs and rent their homes,” the report says. It also cites housing discrimination based on race, and other factors, that make it difficult for people of color to find housing they can afford.

Out of Reach calls for solutions

The affordable rental housing gap won’t be solved by private development, but requires government action, the report says.

“Congress must recognize the urgent need to expand the supply of affordable rental housing, preserve the existing housing stock, provide short-term assistance to renters in crisis, and protect tenants from unfair treatment,” the report says.

Congressional moves that would help increase affordable rental housing suggested in the report include:

  • Significantly increase funding for rental assistance through the Housing Choice Voucher program.
  • Increase federal investments to preserve existing affordable housing stock and in programs that expand the supply of deeply affordable units.
  • Provide funding for a national housing stabilization fund for renters at risk of housing instability because of unexpected financial crises.
  • Create “robust measures” that protect renters from landlord discrimination, ensure the safety and just treatment of renter households, establish anti-rent gouging protections, eliminate arbitrary screening policies to ensure housing access for people exiting the criminal justice system, and support “just cause” eviction standards.


About this Author

Maureen Milliken

Maureen Milliken is a contract reporter and content producer for consumer financial agencies. She has worked for northern New England publications, including the New Hampshire Union Leader, for 25 years, and most recently at Mainebiz in Portland, Maine. She can be found on LinkedIn and Twitter.