Late last year I wrote a post (dated September 21, 2020) which used Census data to answer the question, “What are renters renting in Niagara?” I found that the bulk of Niagara’s renter households are most likely to rent detached houses and units in multi-unit buildings with less than five floors, followed by multi-unit buildings with more than five floors. I also found that Niagara’s renter households s are likely to be younger, usually in their 20s and 30s, and that the bulk of Niagara’s renter households are paying from $500 to $1,499 per month for housing (total costs including rent, utilities, insurance, etc.).
In this post I want to expand on my third finding (about housing costs) using Census data that compares total monthly housing costs for Niagara’s renter households separated by total household incomes. The chart below shows this data. How should this chart be read? Starting at the left, among renter households paying less than $500 per month (rent plus utilities, insurance, etc.) there are 305 households with incomes from $20k to $29k, 330 households with incomes from $30k to $39k… etc.
Not surprisingly, the lower monthly housing cost categories are dominated by renter households with lower incomes, mostly those with incomes less than $60,000, but especially those with incomes below $40,000.
However, what’s surprising to me is that the numbers of households with incomes over $100,000 is fairly consistent across the ‘middle’ monthly housing cost categories. There are 410 of these high-income households paying a total of $750 to $999 per month for housing, while 565 are paying $1,000 to $1,249 per month, 455 are paying $1,250 to $1,499, and 495 are paying $1,500 to $1,999. Households with incomes over a hundred grand can theoretically afford monthly housing costs of $2,777 or higher (by applying the generally held rule-of-thumb of allocating 1/3 of household income to housing), which means in Niagara there are more than 2,255 of these high-income households paying less than they can afford.
There’s nothing requiring or forcing high-income household to pay high rents, so as this data makes clear if they can find acceptable housing for low rents they will evidently pay less than they can afford—much, much less in many cases.
In other words, renters aren’t always who we think they are!