Is Homeownership Becoming Out of Reach for Young American Workers?

America is in the middle of an affordable housing crisis, with only people in the highest income brackets now easily able to afford home ownership. For middle class America, especially those earning mid-level incomes, home ownership is simply out of reach. Working men and woman who are the back bone of our economy are being squeezed by the housing-income imbalance that currently permeates in America.

For a local example, according to the Center for Housing Policy, most working people earning between $20,000 and $50,000 a year in metropolitan Philadelphia can’t afford to buy a median-priced house (currently a median-priced house in metropolitan Philadelphia is $294,000). The study goes on to state that in order to be in a position to afford a median-priced home in the metropolitan Philadelphia market, you need to earn an annual median income of $100,715.

Keep in mind, this annual median income level is just to be able to afford a median-price house. This issue is even more extreme if you have other debts and obligations to fulfill. For example, most young college educated Americans now enter the work force with a significant amount of student loan and credit card debt. On average, a recent college graduate entering the work force will have between $10,000 and $20,000 of student loan debt alone. Additionally, incomes in corporate America are shrinking and barely keeping up with inflation (even for the star performers in most organizations).

So how are young American workers “buying” their piece of the American dream today? If they can at all, most are being forced to purchase homes far from the places they work. For example, according to Bob Hay, a real estate broker in the Pocono region of Pennsylvania, there has been a huge influx of people from northern New Jersey and New York City buying homes in the Pocono Mountains because of significantly lower housing prices.

The problems associated with living so far away from your place of employment are significant. There are now people who live so far away from where they work that they must leave their homes at 4:30 a.m. and usually do not get home until 9 or 10 p.m. at night. This type of work schedule is hard on both the employee and his or her family. Eventually, something will have to give. Such a demanding schedule cannot be continued indefinitely. Usually, that something is a divorce or an employee so disengaged with his job that they end up leaving the work force.

From a personal standpoint, I have been affected by the housing affordability crisis as well. I am highly educated, having completed both an undergraduate degree in Accounting at Temple University and my MBA at Penn State University. Additionally, I am employed as a professional in the financial services industry, now having over 10 years experience. However, due to the housing affordability crisis, I have a commute to work that is over 1 hour long. On top of this, the home that my family and I own is only a townhouse unit, not even a single family house. Don’t get me wrong, I love my current home and the area that my family and I currently reside. But I do truly despise my daily commute to and from my office.

So what can be done to provide affordable housing located close to the major areas of commerce? Although there are not any easy answers to this question, I do believe there are things that can be done to ratify this problem. First, local communities need to become aware of the housing affordability crisis that is currently griping working class America. They need to become educated about the issues associated with the crisis, through which there can be an open dialogue for finding real solutions to the problem. Second, State and Local Housing Agency’s need to begin to explore programs that provide housing assistance to the middle-class working American as well. This can be done through requiring affordable housing for all classes of American’s become a mandatory part of any planning and development ordinances in the future.

Affordable housing, especially close to the major areas of commerce, should be an important aspect of every community in America. Providing housing options for all members of the community, regardless of income, should provide for a highly diverse and truly sustainable community. And it sure would be great to not have a 1 hour commute to and from work every day.