Nearly half of Memphis renters are ‘cost burdened’

Nearly half of all Memphis renters are “cost burdened,” definition they spend some-more than 35% of their domicile income on housing.

And compared to a rest of Tennessee, Memphis lease is high and residence prices are low.

Yet, Memphis renters are not creation a burst to home ownership.

Those are among a commentary by a Tennessee Housing Development Agency, whose new investigate shows Bluff City renters knowledge above-average income woes.

The group complicated housing in Tennessee’s 4 largest cities — Memphis, Nashville, Chattanooga and Knoxville — comparing them to any other and to a state as a whole.

The median monthly lease in Memphis in 2015 was $828, that was 8.4% some-more than a $764 statewide average.

Rent high, income low

“The disproportion is generally poignant given Memphis’s median income in 2015 was $36,445, that is 19.4% next a state normal of $45,219,” a group news states.

“Say they are profitable 35% of a $1,500 monthly bill on housing,” THDA investigate researcher Joe Speer pronounced in an interview. “That’s $500 gone. That leaves $1,000 a month for taxes, health care, food, transportation, utilities, child care.”

The problem is even worse for 30% of Memphis renters who compensate some-more than half their income on housing.

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And even during that, Speer’s spontaneous instance of a $500 lease remuneration competence be distant too low.

Typical lease for housing in healthier neighborhoods — where children don’t have to “dodge bullets” — is $900 to $950, pronounced Priscilla Reed, a lending and home-buyer preparation manager for a nonprofit classification United Housing.

Many landlords need a monthly income of let field to be during slightest 3 times some-more than a monthly rent.

$12 hourly not enough

“A chairman who creates $12 an hour can't lease a home in a good area,” Reed said. A third of that person’s monthly income would be $693.33.

The city’s many room or “distribution center” jobs mostly don’t compensate adequate to lease in a healthier neighborhood, she said.

For example, Amazon this week is seeking a internal skill taxation mangle before it invests $72 million in a new southeast Memphis room that would occupy 600 people.

But Amazon’s annual normal salary of $28,912 would support a limit monthly lease of $803.11 if landlords need a three-to-one, income-to-rent ratio.

Out-of-town landlords

Reed believes lease rose in Memphis after so many people mislaid their homes to foreclosure in a Great Recession and indispensable a place to rent. The change generated some-more direct on let housing.

Rent stays so high here given out-of-town investors pounced on a city’s low-priced houses to make income as absentee landlords, she said.

“Neighborhoods that were primarily homeowners are now primarily rentals,” she said. “They jacked prices adult on rent. It usually strike us unequivocally tough in Memphis.”

Surpassing $300 million

The Tennessee Housing Development Agency promotes homeownership by ancillary internal governments and lenders in creation reduce cost mortgages as good as providing down-payment assistance to impending income-eligible home buyers.

For a initial time given a Great Recession, a group this year has reached a $300 million symbol in creation home loans statewide. “And we still have 3 some-more months to go,” pronounced THDA orator Rick Lewis.

$15,000 down remuneration help

Since Mar in Shelby County, 255 home buyers have participated in a module that provides $15,000 toward a down payment, Lewis said.

Across Tennessee, THDA has supposing some-more than $19 million in down remuneration assistance by a $15,000 down-payment assistance program. The group has a sum of $60 million to spend on a module that should final by early 2019, Lewis said.

Last year, a group awarded $98.9 million in Low Income Housing Tax Credits to private developers to build or reconstruct 6 affordable unit developments in Shelby County. That volume represents 40% of all taxation credit allocations in Tennessee. For 2017, a group anticipates providing $21 million in taxation credit allocations to dual Shellby County unit properties, Lewis said.

Anyone meddlesome in information about down-payment assistance can revisit, or ask their Realtor or lender about a program.

Although 70% of a city’s batch of single-family houses was appraised final year for underneath $100,000 — compared to usually 21% of homes in Nashville and about 50% in Chattanooga and Knoxville — homeownership in Memphis forsaken 4.5% in 2010-15 compared to a 3% slip statewide.


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