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The Orlando-Kissimmee-Sanford metro came in high on a new report released by government-sponsored mortgage lender Freddie Mac ranking the top 20 most rent-burdened metropolitan statistical areas in the country. To be "rent-burdened" means spending more than 30 percent of income on rent or mortgage rather than food, transportation, health care and other necessities.
The report used research from four widely cited affordability studies to rank
Miami as the most rent-burdened city in the U.S., followed by San Diego, Los Angeles, New York and Orlando. Two other Florida cities, Tampa and Jacksonville, came in at No. 7 and No. 25 respectively on the most rent-burdened metros list.
Freddie Mac argues that the lack of affordability in Florida is partially due to lack of available and affordable units for people who earn 50 percent to 100 percent of the area median income (AMI).
The median renter income in the Orlando metro area, for example, is $36,000. But the median rent is $1,040. Assuming 30 percent of income is going to rent, people in Orlando would have to earn $41,600 just to afford an apartment and still be rent-burdened, according to the report.
Like so many other things in Florida, the report essentially concludes that it comes down to the state's plethora of low-paying jobs. The Sunshine State's current minimum wage is $8.46, a whole 21 cents more than last year, which translates to a demoralizing $17,597 annual salary for full-time minimum-wage workers.
"Despite significantly lower than average income, the average median rent in the four cities in Florida is only about 2 percent lower than the median rent in the top 50 metros," the report says. "Rents in Florida are near the average for the top 50 metro areas. However, because renter household income in
these markets is significantly lower than the national average, many households are considered rent burdened."
Their relatively higher incomes are why high-cost cities like San Francisco and Washington, D.C., did not top the list, according to Freddie Mac.
"Our research shows that supply just hasn't kept pace with demand in many metros, and that's pushing affordable rents out of reach for millions of American families," Steve Guggenmos, vice president of Freddie Mac Multifamily Research and Modeling, says in a statement. "Firefighters, police officers, teachers and other members of a city’s vital workforce earn only modestly more than their suburban or rural counterparts. As a result, they often struggle to afford housing in the communities in which they serve."
It's important to note that Freddie Mac crunched the numbers using the 2018 National Low Income Housing Coalition's Gap report, which ranked the Orlando-Kissimmee-Sanford area as second in the country for the most severe affordable housing shortage.
NLIHC has since released their 2019 report, which now ranks Orlando as the worst place in the country for affordable housing, with only 13 affordable and available rental homes for every 100 extremely low-income renters. (We're No. 1!)
This makes it all the more shocking that Central Florida is being left out of proposed affordable housing funding by state lawmakers this session. Despite multiple reports indicating Orlando has a severe problem that should be addressed immediately, legislators have proposed giving $123.6 million in housing funds only to Hurricane Michael-damaged areas in the Florida Panhandle.
"Reports have ranked us as No. 1 in the nation, in Orlando, for lack of affordable housing," state Rep. Carlos Guillermo Smith, D-Orlando, said late last month. "I support the money that's going towards the victims of Hurricane Michael, but it's a false choice to have to pick between recovery for Hurricane Michael victims and funding affordable housing."
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