When affordability for decent housing slips beyond the reach of many renters, the issue isn't an isolated one. Housing ails are symptomatic of a bigger issue at hand -- one that could severely affect our economic and political spheres.

Just as former Fed chairman Alan Greenspan used to say, local housing markets are directly linked to local economies. And vice versa. Rising rental rates have also been thought to spur on inflation. (NPR)

The issue is a hot topic for many.

The Rent Guidelines Board met last night to discuss rents in the city of New York.

They approved a measure that will allow landlords to raise rents by as much as 7.25 percent over the next two years -- and that is for "rent-stabilized" apartments. While tenants, many of whom are traditionally on fixed incomes, were at the meeting in full on protest, the board had to consider the rights and annual costs that must be covered by the landlords -- owner costs rose 7.8 percent in the last year. As interest rates rise and other living costs skyrocket -- it is no wonder this issue has been brought to the forefront.

But affordability is already out of the reach of many middle-income families, with many spending over a 1/3 of their monthly income just for a roof over their heads, not to mention costs of energy bill and gas for commutes.

The Rent Guidelines Board released their annual "Income and Affordability Study" in April of this year. In it they found that while unemployment rates are down in the city (5.8 percent), inflation is higher than in years past. And many middle income families are spending nearly 32 percent of their income on housing.

The national average rental cost at this time is $940, while in New York City that cost is $850. For rent stabilized apartments we see a rate of $844 a month.

The truth is that each of those amounts is steep for a family to pay.

Buying a home can be a very feasible option to avoiding paying high rents. Paying rent is a lowsy investment. There are hundreds of programs available to allow low and moderate income families and minorities a chance at owning. Contacting your local Realtor association could be a smart first step.

If buying a home is not an option, then the rents must be paid, and as rental rates aren't set to drop any time soon -- what can be done?

The minimum wage rate needs to be raised. It is currently set at $5.15 an hour, and Congress is currently in battles to decide if it should be raised nationwide.

And then anyone tight on money needs to live by a strict budget. This is a "band-aid" on a personal level and won't do anything to alleviate the rising costs nationwide, but it can reduce some financial stresses. For more information on Debt Management, click here.

Published: June 29, 2006

Use of this article without permission is a violation of federal copyright laws.