As the affordability gap for home ownership increases, more and more individuals and families have been forgoing the dream of home ownership and have turned toward rental housing instead. Currently renters have an even more difficult time in our local housing market.  At the time of the 2000 U.S. Census, 40.6% of all county renter households paid more than 30% of household income for housing.  By 2018 however, 62.5% of renters were paying over 30% for their housing and 22% were severely overpaying by more than 50% (HUD CHAS, 2021 American Community Survey).  15,744 low-income renter households across the county do not have access to an affordable home (CA Housing Partnership 2021). Santa Barbara County also ranked 4th among all 58 California counties for having the most severe cost burden for renters.

Out of Reach, a side-by-side comparison of wages and rents throughout the United States, calculates the Housing Wage, defined as the hourly wage a worker must earn to afford the Fair Market Rent (FMR), based on the generally accepted affordability standard of paying no more than 30% of income for housing costs (National Low Income Housing Coalition, 2020). According to the report, in Santa Barbara County the FMR for a two-bedroom apartment was $2,324 in 2020.  In order to afford this level of rent and utilities – without paying more than 30% of income on housing – a household would have to earn $7,746 monthly or $92,960 annually.  Assuming a 40-hour workweek, 52 weeks per year, this level of income translates into a Housing Wage of $44.69 per hour, however the median hourly wage for all occupations in Santa Barbara County in 2020 was only $29.26 per hour, far below what is required to afford a two-bedroom apartment.  Minimum wage earners are even more burdened: a household earning a minimum wage of $13 per hour would have to work 138 hours per week to afford a two-bedroom apartment.

Renters in Santa Barbara County face low vacancy rates with steeply rising rents that create cost burden. For example, according to the South Coast Chamber of Commerce and the California Economic Forecast, in September 2022, the vacancy rate for South Coast apartments is 1.4%, with the median South Coast apartment rent increasing 11.6% year over year.

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Again and again, local surveys and data show that low wages and high costs of living – specifically high housing costs – are driving employers and employees out of the area, further highlighting the importance of developing a local, sustainable fund, through a multi-interest partnership at the intersection of the public, private and non-profit sectors. HTF can serve as a vehicle to achieve the necessary goal of establishing a local fund for affordable and workforce housing.