Chattanooga: Rent costs increase faster than wages

Rental housing prices here are rising faster than hourly wages and, at the same time, demand for affordable housing is increasing.

“A worker earning at or near minimum wage faces extreme hardship in paying for housing,” according to an Ochs Center for Metropolitan Studies report on housing in the Chattanooga region.

Ochs Center officials will present the report’s housing data today to the City Council. The 37-page document is one portion of the center’s 250-page 2008 State of Chattanooga Region Report.

The complete report, which includes education, health, crime and economic development pieces, is expected to be available by the end of the year.

“Policy makers want to distribute and manage resources, but a lot of time they don’t have the information,” said Eileen Robertson-Rehberg, the Ochs Center’s director of data analysis. “We hope this report fulfills that requirement.”

For many residents, the cost of housing has increased to near-unmanageable levels over the past seven years, according to the report. The 2000 U.S. Census stated that more than one-third, or about 36.8 percent, of the 56,056 renters surveyed in six Chattanooga metro counties spent more than 30 percent of their income on housing. By 2007, that number had increased to 43.5 percent, according to the bureau’s American Community Survey estimates.

“It means that more people are having a financial burden,” Ms. Robertson-Rehberg said. “Too much is going to housing, and the implication is they don’t have enough for food or other necessities.”

In the region, Sequatchie County, Tenn.,and Catoosa County, Ga., had the highest growth rates in housing units, with Sequatchie showing a 25.2 percent increase and Catoosa showing a 16.8 percent increase, according to the Ochs Center report.

Sequatchie County Mayor Michael Hudson said his county has been one of the fastest-growing counties in the region for the past few years, and he hopes that trend continues.

But while demand for rental housing is growing, low pay adds another layer to the problem, according to the report.

“Part of the issue isn’t the cost of housing, it’s having access to jobs that pay wages enough to pay for certain types of housing,” said David Eichenthal, Ochs Center president and chief executive officer.

And the cost of housing in Chattanooga is relatively low compared to the cost of housing in similar cities, he said. Based on data from the 2007 American Community Survey, the Chattanooga metro area has the lowest median rent among 14 comparable midsize cities including Columbia, S.C.; Winston-Salem, N.C., and Huntsville, Ala.

The problem of available and affordable housing hits home in almost every community in the nation, said Douglas Rice, senior policy analyst with the nonpartisan Washington, D.C.-based Center on Budget and Policy Priorities research organization. Increasing the minimum wage would help, he said, and it also would be beneficial to increase federal funding for rental assistance.

“Only 1.5 percent of the federal budget goes toward housing assistance,” Mr. Rice said.

And for many low-income workers, money for housing is getting much tighter in Chattanooga.

In 2007, Chattanooga Housing Authority officials developed a housing task force to focus on providing housing for minimum-wage workers and working professionals. However, in September 2008, the authority closed its waiting list for scattered site housing, small complexes where many low-wage workers live. The lists closed with about 348 people waiting for such housing, and housing officials said it could take 10 years to house those still on the list.

In January, the housing authority also closed its Housing Choice Voucher subsidized rents waiting list, with more than 3,500 people still on it. That program formerly was known as Section 8.