Rents have been on the rise in Austin for several years, with no relief in sight. While Austin renters are not as cost-burdened as those in some cities, one does wonder how those rents shake out compared to median wages in the city and how it compares with the rest of the country in that regard.
According to a new study by Smart Asset, Austin ranks in the top 10 of major U.S. cities where residents have to put in the most hours per week to afford rent.
The study looks at how many hours of work are needed to pay rent in the country’s 25 largest cities by analyzing average annual take-home pay, average hours worked per year, and median monthly rent. All the data was taken from the U.S. Census Bureau’s 2018 one-year American Community Survey.
In Austin, to afford the monthly rent of $1,314 per month, someone would have to work 47.3 hours per week. The study assumes an estimated hourly wage of $22.92 (after taxes, it should be noted).
Some of the study’s premises can certainly be questioned. The calculated monthly rent does not differentiate based on number of units, and the yearly income is based on individuals rather than families. Austin Neighborhood Housing and Community development put 2109 median annual income for individuals at $67,150 before taxes, which shakes out to at least $26 per hour after taxes (using Smart Asset’s tax calculator). The disparity could be in part attributed to differences in how much of the metro area is being taken to account in Smart Asset’s study.
Most data from listings sites put Austin median rent for 2019 at around $1,200 for a one-bedroom apartment and $1,470 for a two-bedroom. Since the data every site takes into account is different, disparities aren’t unexpected, and Smart Asset’s estimated median rent makes sense if it’s using rates from different-sized units. Austin has been a majority renter city since 2018, according the Rent Cafe blog.
Whatever the case, the analysis make it clear that renters in many major cities are in worse positions—particularly those in the three at the top of the chart: San Jose (76 hours per week), Los Angeles (73.9 hours per week), and San Diego (73.2). According to the Smart Asset report, annual rent made up “more than 30% of average earnings in all 25 cities in our study, suggesting that many residents may be housing-cost burdened” but that housing costs in those three cities consumed “more than 50% of average earnings for workers.”
Austin and Nashville, Tennessee, tied for 10th place on the list. Other cities at the top of the list were Boston (67.6), Denver (61.4), New York (61.3), San Francisco (60.6), Seattle (60.6), and Charlotte, North Carolina (58.5).