Rent Goes Up and Health Goes Down
In many of the nation’s 35 largest metropolitan areas, rent has increased beyond affordable rates for a number of residents. For instance, Detroit has one of the most affordable rental rates of the largest metropolitan areas. However, it takes dual income earners to be able to afford the current prices of rent in that market.
When the housing bubble exploded, many people lost their homes. As a result, the market became flooded with renters. The demand of renters caused rental prices to drastically increase.
One of the biggest concerns is what happens when rental rates increase, and how do people manage to afford the rate hikes. The unfortunate reality is people often neglect other equally as important areas in order to make their rent payments. This results in a perpetual cycle of ‘robbing Peter to pay Paul’ for many renters.
Increased Rent Equals Medical Neglect
Since 2014, rental rates have increased by approximately 6 percent in one year. More people are renting now than ever. As a result of the rising rental rates, many people are neglecting routine medical examinations and dental check-ups.
Although people know their health is important, they simply cannot afford the additional medical expenses and their rent payments. According to an October 2014 report by the Federal Reserve Board, dental care and medical prescriptions were neglected as a result of high rent payments. The survey indicated that people with high rent burdens were more affected in this area.
- 40% skipped dental check-ups and routine cleanings.
- 13% skipped doctor-recommended physical therapy sessions.
- 23% took less prescription medication than prescribed.
- 16% did not go to see medical specialists such as dermatologists and orthopedic surgeons.
Lack of medical care can have far reaching consequences. As people age, they tend to develop degenerative diseases. Many of these diseases can be treated if caught early. People who have to pay their rent instead of going to the doctor are impacting their future health conditions.
Increased Rent and Retirement
Since the Great Recession, a large number of people have wiped out their savings. An equally as large percentage of people are prevented from saving for retirement. Many of the respondents of the survey have given little thought to saving for retirement. The daily rent burdens seem to have outweighed preparation for the future. In fact 59% of the respondents with high rent burdens did not have 3 months savings.
The outlook for respondents who have 401(k) and 403(b) are equally as bleak. Due to the high costs of rent, they are not able to maximize and take advantage of saving for their future.
Increase Rent and Savings
A popular commercial has a tagline that states ‘It’s hard to save for the future when you cannot see past today.’ This is especially true when it comes to people who have high rent burdens.
The immediate cost of rent and taking care of personal expenses prevent them from saving any money for the future. Many of the respondents of the survey were not able to adequately prepare for future emergencies. They did not have 3 months of living expenses set aside. Some of the respondents used credit cards as a way to deal with emergencies.
Although this data represents the responses from one survey, these statistics seem to be the new reality for a high percentage of people. High rent prices affect car purchases, healthy food purchases and general well-being. If something is not done to rectify this situation, rental hikes can have drastic effects on other areas as well.