Health-Care Workers Priced Out of Housing Markets
We recently reported on the disturbing number of Americans currently unable to afford housing costs across the country. Now, let’s focus on a specific niche having difficulty in this area:
Health-care workers.
Such professionals may be in demand, but in many cities they aren’t able to afford a median-price home, according to a study released last week.
Licensed practical nurses were priced out of the average home in 187 of the 202 metropolitan areas studied, according to the report, “Paycheck to Paycheck: Wages and the Cost of Housing in America,” released by the Center for Housing Policy. Funding for the annual study came from Freddie Mac.
The situation wasn’t much better for registered nurses: they couldn’t afford a median-price home in 115 of the cities studied. Physical therapists in 104 of the areas were priced out the chance to apply for a home mortgage.
The results are distressing, considering the large demand for health-care workers in many job markets, Barbara Lipman, research director for the Center for Housing Policy told MarketWatch.
“With the aging of the population and increasing reliance on health care, it’s alarming to consider that some of these positions in hospitals are going vacant because people can’t afford to live in communities in which they serve,” she said.
Take, for example, the Baltimore housing market, where Johns Hopkins Hospital is based. The median home price there is $275,000, according to the report.
Assuming that not more than 28% of household income would be spent to pay the Maryland mortgage, property taxes and insurance - and factoring in a 10% down payment - the annual income needed to purchase a home of that price in Baltimore is $94,206.
But a registered nurse makes a median annual salary of $60,504 in that market, while a licensed practical nurse makes $38,306. A nursing aide’s median salary in Baltimore is $25,532, a physical therapist makes $64,400 and a home health aide makes $21,063.
Prices are a bit more affordable in the Rochester, Minnesota housing market, where the Mayo Clinic is based and the median home price is $149,900. The report figured the annual income needed to purchase a home of that price was $51,351 - an amount that a registered nurse or physical therapist making the median annual salary could afford.
Even in Rochester, however, licensed practical nurses, who have a median annual salary of $39,035, couldn’t afford the median home. Neither could nursing aides, who make a median $25,404, or home health aides, who make a median $21,643.
On a national scale, an annual income of $84,957 was needed in order to qualify for a mortgage and/or purchase a median-price home, which cost $248,000 during the third quarter, according to the study.
Nationally, registered nurses had an annual median salary of $58,640, licensed practical nurses followed with a median $37,127, and nursing aides made a median $24,745, the study found. Physical therapists made a median $62,417 and home health aides a median $20,414.