Do You Need Help With Rent? Try Our Calculator
I’ve been making the point that we could make our resources go a lot further if we just make direct cash payments to people who need help with rent. So we decided to make a calculator that would show renters just how much more than the normative standard they are paying using a simple calculator at helpmewithrent.com. The point of this is to show people just how much they are overpaying rent or how “cost burdened” they really are by taking their rent and then comparing that to their income and then calculating whether the renter is paying more than 30 percent of their income on rent. If they are, they’re paying too much. Shouldn’t the City just use levy money and other subsidies to pay that difference? Wouldn’t that be more efficient? The devil is in the details but the calculator, we hope, might get people thinking that instead of complaining about a housing crisis, the City should just help with rent. Check out the site.
Here’s the text on the page after a renter calculates their rent.
Federal, state, and local government have decided that you should pay no more than 30 percent of your total monthly income on housing costs. If you earn $36,000 per year, or $3,000 per month, for example, you shouldn’t pay more or less than $1,000 for rent. How did government arrive at this number? It’s really a mystery. But it’s the standard that is applied for housing affordability all over the United States and here in Seattle.
How does the City of Seattle determine whether you deserve help with your rent? They put your income on a scale and determine where it relates to median income. As the Seattle Housing Authority’s website explains, median income, “means that half of the people earn more than the median, and half of the people earn less.” Currently, in Seattle, the median income is about $80,000.
To get help from the City to pay your rent, you must earn 80 percent of that or less as one person. However, the City hasn’t adjusted its numbers to match the numbers from last September, so their standard is still $60,687. So to get help from the City you need to earn about $48,500 or less as a single individual. And then the City applies a different formula based on the number of people in your household (you can go to the City’s website to see all their numbers).
This is all confusing, isn’t it? Why 30 percent? Why median income? What does affordability really look like for you and your friends and family? And if you’re paying too much rent based on the City’s definition, why aren’t they helping you pay the difference? And what are they doing to help you out?
Currently the Seattle City Council and Mayor support programs that take years to produce housing that could help you if you’re paying too much rent. In fact, one project that cost $45 million to build has a waiting list of 5 years! The Seattle Housing Levy is supposed to bring in $290 million dollars. Based on current performance, that would only produce about 580 units over 7 years, or about 82 units per year.
Math hurts. But let’s try some. The City says there are about 1,750 households at about 60 percent of Area Median Income, or about $36,000 per year in wages that are paying about half that income for housing. That means using the City’s formula, they should pay about $900 per month; but those households are paying $1,500 for housing, or half their income. How much would it cost to just give those households the difference between what they’re paying and what they should pay according to the City?
- Cost burdened household pays:$1,500
- They should pay:$900
- What’s the difference:$600
- How many households:$1,750
- Cost of paying the difference:$1,050,000 per month
- .$12,600,000 per year
- .$126,000,000 for ten years
Think about it. We could use less than half the levy money collected in 7 years time, $290 million and pay the cost burden of 1,750 households for a decade. Or we could use that same amount of money to help off set the costs of rent for even more people for less time? Of course, median income would change over that time, and many families would start earning more. But the point is why doesn’t the City just help you with your rent?
If you think direct help with your rent makes sense, tell the candidates for Mayor and the City Council.
