News Column

So. Fla. Least Affordable Metro for Moderate-income Families

Oct. 18, 2012

Donna Gehrke-White, Sun Sentinel

South Florida is the least affordable of the nation's 25 largest metro areas for moderate income households struggling to pay for housing and transportation, according to a new study released Thursday.

South Florida households that make between $25,444 and $50,888 per year end up spending nearly three-fourths of their income just for shelter and to get around, the national study found.

Those who live in Broward, Palm Beach and Miami-Dade counties shell out an average 40 percent of their income for housing and an additional 32 percent toward transportation, according to the research conducted jointly by the Washington-based Center for Housing Policy and the Center for Neighborhood Technology in Chicago.

In contrast, their counterparts in the nation's other large urban areas pay an average of 59 percent of their gross income for both, the study reported.

Researchers blame South Florida's high percentage of low wages that haven't kept up with inflation.

"Things got worse in the last decade," said Robert Hickey, senior research associate for the Center for Housing Policy. "Expenses rose twice as fast as pay."

Housing and transportation costs are "so out of sync with local incomes -- among the lowest of the metro areas -- that they consume a very large portion of the household budget," according to the study.

Sarah Nunez, a Hair Cuttery hairdresser in Southwest Ranches, feels the crunch every day. The single mom calculates she needs $10 a day in tips just to put gas in her car to get to work. That can eat half of her daily tips, she said.

By the time Nunez pays bills after payday, she often has only $50 left, Nunez said. "It's hard," she said. So Nunez volunteers to work double shifts or to take the place of someone who calls in sick.

"I'm always looking for the opportunity for work," Nunez said.

The Great Recession has made conditions worse for many South Floridians. Thousands were laid off, had work hours reduced or were forced to take furloughs in the past five years. But they still had to find a way to get to work or to a job interview.

Many have called for help in paying their rent or mortgage payments, said Patrice Schroeder of 211 Palm Beach/Treasure Coast, a social service hot line.

"We are seeing the people who have used up their unemployment benefits," Schroeder said. "People are scrambling."

Those using food stamps have more than tripled in five years in Broward and Palm Beach counties, according to the Florida Department of Children & Families, which administers the federal program.

Even middle-class families with steady jobs are finding it hard to buy a home in the three counties, another study found.

South Florida comes in 22nd of the 25 largest U.S. metro areas when it comes to a median-income family's ability to buy a home, reported a subsidiary of North Palm Beach-based Bankrate.com on Wednesday.

The median household income in Broward, Palm Beach and Miami-Dade counties remains 13 percent short of what it takes to buy a median-priced home here, the Interest.com study found.

That's not only because the median home price -- now at about $206,700 in South Florida -- has recently regained some lost value, said Mike Sante, managing editor of Interest.com.

Rather, he put much of South Florida's affordability problems on escalating home insurance premiums and local property taxes.

Home insurance policies can cost three times as much here than in Midwest cities such as Milwaukee, Sante said.

"Your homeowner's insurance costs are not quite as high as Texas, but you live in a hurricane zone," Sante said. "Your property taxes are [also] a little bit higher than average."

That factors into South Florida being more expensive than other metro areas, he said.

Still, it's not all doom and gloom, said Jorge Salazar-Carrillo, an economics professor who directs the Center for Economic Research at Florida International University.

The weather is mild and South Floridians save by not having to pay the North's heating bills, he said. Food also is cheaper than in other parts of the country, he added, and people can take advantage of fresh produce grown locally.

"I know there are problems here in South Florida, but it is worse in other areas," said Salazar-Carrillo, pointing to the high cost of living in the Washington, D.C., area where he once lived.



Source: (c)2012 the Sun Sentinel (Fort Lauderdale, Fla.) Distributed by MCT Information Services


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