Man shares his insights into the dark reality of wages failing to keep up with abnormally high rent, pushing people into a circle of poverty.
Wages failing to meet the rising cost of living has become a significant problem that no one can turn a blind eye to. The bare minimum people want these days is to afford basic housing with their hard-earned money, but even that seems challenging. Lucas –who goes by @LucasBrownEyes on X (previously Twitter)– shared an elaborate post detailing how the average rent and hourly pay in the US does not compute. The post has become quite popular on the platform, with 781.6K views, 23K likes and over 7K retweets.
The median US rent is $1967. Which means the median US hourly pay which would be considered livable (1/3 of rent) should be $35.40
— Lucas Brown Eyes (@LucasBrownEyes) February 3, 2024
The current US median hourly pay is… $17.02
Society will never be “okay” until this is fixed. It’ll always feel like a bad economy because of this
He starts by revealing how the median rent in the US was a whopping $1967. According to him, this kind of money for rent necessitated that workers in the country should at least be paid an hourly wage of $35.40, which amounted to one-third of their rent, making it "livable." However, the reality is even more depressing because he shares how the US median hourly pay is a measly $17.02, highlighting the dark economy we are presently going through. He writes, "Society will never be 'okay' until this is fixed. It'll always feel like a bad economy because of this."
FIX HOUSING PRICES. One sector cannot keep screwing over the entire country like this.
— Lucas Brown Eyes (@LucasBrownEyes) February 3, 2024
He later replied to his initial post by suggesting that the government should divert its attention toward fixing housing prices. "One sector cannot keep screwing over the entire country like this," he writes. To support his analysis, he provides a hypothetical scenario of an individual being paid $17 an hour. It would mean that they made $34,040 in a year. If one takes into account a one-bedroom space that was rented out at $1496 a month, the total cost in a year would be $17,952. So, the individual would end up paying an astounding 53% of their salary towards rent, leaving very little for expenses and savings.
For the people who want it to be a one bedroom:
— Lucas Brown Eyes (@LucasBrownEyes) February 4, 2024
One person makes a median of $17 per hour, $34,040 yearly.
Median One bedroom = $1496/month, $17,952 yearly.
Rent is 53% — still way too much
But this ignores single parent & single income families who need more than 1 bedroom
But this case is ideal as he points out how there were families that only had a single source of income and needed living spaces that had more than one bedroom. He states how the one-third budget rule came about as a solution for single-income households, but that was not relevant anymore. Even before the 1960s, when a large majority of households survived on a single source of income, the rule of thumb was to allocate only one-fourth of the monthly income to housing costs.
The 1/3 of budget rule had single income households in mind. Hell pre-1960s when single income households were over 90%, the guide was 1/4 of your gross budget on your house.
— Lucas Brown Eyes (@LucasBrownEyes) February 4, 2024
I forgot. For the median 1 bedroom rent to be the suggested 1/3 of median gross income. They’d have to make $26.93/hour
— Lucas Brown Eyes (@LucasBrownEyes) February 4, 2024
But that’s gross income. Even with the “ideal budget” that’s actually around ~44% (depending on tax rate)
In real life — median 1br is ~64% of a median income
Even for an individual to afford a one-bedroom house complying with the one-third rule, they would have to make at least $26.93 an hour. But accounting for taxes would push the average individual to spend 44% of their income on housing. In real life, that would translate to almost 64%, which is worrying, to say the least. The man reveals, "Also the most recent realtor propaganda is 'Well, people wanted bigger homes. They should get a starter' — LIE. These are not starter homes. Starter homes are seven figures."
I forgot. For the median 1 bedroom rent to be the suggested 1/3 of median gross income. They’d have to make $26.93/hour
— Lucas Brown Eyes (@LucasBrownEyes) February 4, 2024
But that’s gross income. Even with the “ideal budget” that’s actually around ~44% (depending on tax rate)
In real life — median 1br is ~64% of a median income
The housing market has been manipulated to A) provide tax and investment shelters B) keep people out of home ownership because property is wealth.
— Sarge (@TwobranchNCO) February 4, 2024
He highlights how many homes are almost a century old, with little space and has a selling price of $1 million, which no parent could afford. People found Lucas' breakdown quite startling and shared their opinions in the comment section. @PhineasDelgado commented, "The root cause of this is that enough is never enough. It always has to be more. More money, more growth, more profit every year. The shareholders demand it, and the owners demand it. Making the same amount of profit as last year is considered a failure."