Hudson Valley Pattern for Progress has released Out of Reach 2024, a new report that illustrates the steep rise in housing costs over the past year, as surging rents and stagnant wages worsened the strain on tenants throughout the entire region. While housing stress is most acute for those who earn the least amount of money in our economy, the latest data show that even the core of our middle class in the Hudson Valley is now struggling to find an affordable place to live. 

 

The data show that our years long  affordability crisis is getting worse in the Hudson Valley. A single worker making average wages cannot afford fair-market rent in any of the nine counties served by Pattern. The gap between tenant wages and fair-market rent grew substantially in every county except one, as rents increased by more than $200 per month in many places over the past year. Homeownership also remained out of reach for the majority of our neighbors. An analysis by Pattern found that median-earning households cannot attain enough mortgage to purchase the median priced home anywhere in the Hudson Valley. 

 

“The struggle to create housing that is affordable for people across the entire spectrum of income will be the defining civic issue for this generation of leaders in the Hudson Valley,” Pattern CEO Adam Bosch said. “There is ample evidence that the housing crisis is exacerbating our regional workforce shortage, as more people pack up and leave the Hudson Valley in search of a more affordable standard of living elsewhere. We cannot look away from this challenge. To preserve our wellbeing and quality of life, the Hudson Valley must allow and encourage more housing, rather than opposing and protesting it.” 

 

Out of Reach 2024 utilizes county-by-county data from the National Low Income Housing Coalition, which examines hourly wages and fair-market rents to analyze the affordability of rental housing. (Fair-market rent is the 40th percentile of renters who have moved within the past two years, which means it is lower than median market-rate rents.) Affordability is calculated by the standard that no individual or family should spend more than 30 percent of its total monthly income on housing. This year Pattern also used that standard to measure the affordability of homeownership in the Hudson Valley. We calculated the mortgage for which one-person, two-person, and four-person households earning the area median income would qualify and compared that to the median price of homes in each county. Pattern examined these data for the nine-county region, including Columbia, Dutchess, Greene, Orange, Putnam, Rockland, Sullivan, Ulster and Westchester counties. 

 

Some key conclusions from the report include the following:

 

• Single adults working 40 hours per week on average wages cannot afford a one-bedroom apartment in any of the nine counties. Tenants’ wages would need to increase between $2.50 and $31.67 to afford fair-market rents in their respective counties. 

 

• Fair-market rents would need to decline anywhere from $130 to $1,647 per month to make them affordable for a person earning average renter wages across the region.

 

• The gap between wages and rent has gotten larger in every county except Greene. In recent years, rent increases have outpaced wage increases by about double. However, this comparative rate of change increased significantly over the past year. For example, average tenant wages in Dutchess, Orange and Ulster counties remained nearly flat while fair-market rents in those counties increased by approximately 15%. The biggest gap was in Westchester County, where average tenant wages dropped by 9% and fair-market rents increased by 16%. 

 

• The outlook also worsened for people seeking a two-bedroom apartment. For households that include two earners making average wages, rent remains unaffordable in Orange, Putnam, Rockland and Ulster counties. The positive margins are fairly small in the remaining five counties. 

 

• Wages earned by a typical renter ranged from 34% to 51% of the area median income in each county, a key metric for housing policies and programs. In 2023, average renters earned 39% to 61% of the area median income. This change underscores that greater wage growth is happening in the higher income brackets, while renter wages remain stagnant.  

 

• The majority of households in the Hudson Valley cannot qualify for enough mortgage to purchase the median priced home in any of our nine counties. This is true for one-person, two-person, and four-person households making median wages in each county. A two-person household falls anywhere from $99,665 (Sullivan) to $280,410 (Rockland) short of qualifying for enough mortgage to buy the typical home in each county. Consequently, data show that more middle-class households are leaving the region in search of a more affordable options in our neighboring states, or in Southern states such as Florida, North Carolina, and South Carolina. 

 

The data in Out of Reach indicate that renters and homeowners in the Hudson Valley have little to spend on necessary and discretionary expenses because the cost of housing is gobbling up a large proportion of their incomes. Recent research by Pattern also found that an influx of wealthy households into the region during the pandemic caused very fast gentrification in certain counties, exacerbating the housing stress that already existed. For example, households that moved into Columbia County during the brunt of the pandemic brought an average adjusted gross income of approximately $160,000, while those who left the county earned an average of just under $70,000. This same trend occurred at different scales in Dutchess, Greene, Sullivan and Ulster counties. The influx of new wealth pushed up the cost of all types of housing – along with the assessed values of land and homes – making it less viable for low- and moderate-income people to move or buy a home in the region. 

 

The affordability crisis in housing has also exacerbated a workforce shortage in the Hudson Valley, as working-class families move out of the region and have fewer children. The latest migration data from the Internal Revenue Service found that the Hudson Valley lost a net of 12,257 people in 2021, the largest net out-migration since 2005. The region has lost more people than it gained to migration for 25 of the past 26 years – a trend that has resulted in a net loss of 146,763 people, according to federal data. (More information can be found in Pattern’s latest Moving In, Moving Out report.) In 2022-2023, there were 47,865 fewer students attending public school in the Hudson Valley than the peak of enrollment in 2003. Data on migration and school enrollment indicate that our workforce in the region is likely to continue shrinking over the next decade, especially as the Baby Boomer generation retires in greater numbers. These challenging trends are connected to, and partially caused by, the forces of stagnant wages and higher housing costs that are underscored in Out of Reach 2024.