Rents have been on the rise in Detroit for several consecutive years. But how is that tracking with median wages in the city and how does it compare with the rest of the country?
According to a new study by Smart Asset, residents of Detroit have to work the fewest hours per week to afford rent of any major city in the United States.
The study looked at how many hours of work are needed to pay rent in the country’s 25 largest cities by analyzing average annual take-home pay, average hours worked per year, and median monthly rent. All the data was taken from the U.S. Census Bureau’s 2018 1-year American Community Survey.
In Detroit, to afford the monthly rent of $836 per month, someone would have to work 41.6 hours per week. The study assumes an estimated hourly wage of $20.25.
Some of the study’s premises can certainly be questioned. The calculated monthly rent does not differentiate based on number of units, and the yearly income is based on just individuals, not families.
We also know, based on the 2017 American Community Survey data, that Detroiters are rent burdened—around half of the city’s residents put 35 percent or more of their income towards rent. At some point in the last decade, Detroit became a majority renter city.
What this analysis makes clear, however, is that renters in the rest of the country are probably worse off. “Annual rent comprises more than 30 percent of average earnings in all 25 cities,” the study says. In San Jose, the most expensive city on the list, residents need to work 76 hours per week to afford the median monthly rent of $2,161.
Other cities at the top of the list were Los Angeles (73.9 hours per week), San Diego (73.2), Boston (67.6), Denver (61.4), New York (61.3), San Francisco (60.6), and Seattle (60.6).