This is the actual source of the article[1]. The methodology does not support the claim the title makes.<p>>LendingTree used U.S. Department of Labor and U.S. Census Bureau data to determine whether owning or renting a home is affordable to a person working a full-time minimum wage job. Assuming a person could afford to spend up to 30% of their gross monthly income on housing, LendingTree calculated how much in monthly housing costs a person working 40 hours a week for 52 weeks a year at an hourly wage equivalent to their state’s minimum wage could afford. Researchers then compared that figure to the median monthly homeowner costs for homes with a mortgage and the median monthly gross rent payment in each state.<p>So, to recap. This study assumes you must spend less than 30% of your income on housing and assumes that all housing costs the median homeowner/rent payment. These are both independently terrible assumptions but combined you get total nonsense. People earning in the bottom 5 percentiles of the income distribution do not rent places that charge 50th percentile rent. They also are not arbitrarily constrained to follow good budgeting guidelines which specify not more than 30% of income to housing. I know this because according to this methodology, the arrangement which I very comfortably made it through grad school in is apparently not possible.<p>[1]<a href="https://www.lendingtree.com/home/mortgage/minimum-wage-workers-study/" rel="nofollow">https://www.lendingtree.com/home/mortgage/minimum-wage-worke...</a>
> They calculated how much in monthly housing costs a person working 40 hours a week for 52 weeks a year at the minimum wage hourly rate in their state could afford. They then compared that to the median monthly homeowner and rent costs derived from the U.S. Census Bureau’s 2019 American Community Survey.<p>This … signifies nothing? Take a hypothetical state that consists of three people and three houses, one rented by me at my minimum wage job for $350 a month, and the other two rented by Bill Gates and Warren Buffett at $55m/month.<p>The median is way unaffordable to me, yet I have a comfortable rent payment.<p>Comparing minimum to minimum would be a more useful metric.
It’s worrying that people can’t afford their own home. That feeling of security cannot be understated: knowing where you can sleep for the next night.<p>Everyone living in a rented apartment is under constant survival stress, with a subconscious fear of joblessness and eviction.
Minimum wage is not the problem as this article seems to imply. People move up from those starter jobs, they don't stay there forever.<p>The problem is that the politicians and local governments have enacted strict building and zoning laws which disallow for new housing construction. This, in combination with market forces has driven up the price of housing artificially fast.
In other news: Investing in real estate has never been better! Just buy couple of properties and money starts flowing from every direction. Dont want annoying tenants? Dont even bother renting long term. Airbnb that bitch or just sit on it and watch house prices go up and up and uuuuup.
> The researchers defined a maximum of 30% of gross monthly income on housing as affordable.<p>By that measure rents are unaffordable even to SV workers.
I’m not entirely sure how we got to this place but it definitely feels this way in the UK too at times, though the circumstances might be different.<p>Housing as an absolute expense has risen faster than income in nearly every developed country that I can think of.<p>But, something that I always bring up when minimum wage is mentioned as a panacea: Sweden does not have a federally mandated minimum wage, but people are paid relatively handsomely.<p>This is because of strong union protections.<p>The solution could be unions but I guess the American people have a dim view of unions and companies aggressively crush them.
I'm not american and yahoo has a cookie wall.<p>How exactly are those people managing to survive? My country has welfare that allows people to pay rent and food. I'm not really aware of how american welfare works, but I guess it varies a lot between states?
They compared minimum wage to <i>median</i> housing costs, and found that minimum wage is not enough to afford median housing.<p>But isn't this exactly what we'd expect? You can't have everyone able to afford housing that is in the top 50% of housing costs (except possibly in Lake Wobegon).<p>This seems like the housing equivalent of those periodic "richest N% have M% of the wealth" where M > N stories that present that as something obviously bad when in fact in any population where there are variations in wealth it is mathematically necessary that the top N% has more than N% of the wealth.
They compared minimum wage to <i>median rent</i>.<p>Why? Of course someone making the legal minimum wage can’t afford the <i>median</i> rent.<p>Median rent in SF is $2,600 [1]. That’s a pretty nice 1-bedroom in a nice part of town.<p>You can find single rooms to rent for less than half that. That would seem like a better benchmark than the median?<p>This analysis was intentionally sandbagged.