Henry McKoy, a finance professor at North Carolina Central University in Durham, N.C., explains how housing is just one area where people are seeing rising costs.

“Housing is one of those areas where you’re just seeing a ratchet up of cost. For those who are doing well in the economy, that’s fine. But for those who are kind of in those jobs that don’t see a lot of pay increases, those people that are fighting for $15 an hour wages…those folks are being left behind.” – Henry McKoy, professor of finance at North Carolina Central University.

NCCU Finance Professor Henry McKoy talks about the value of creating affordable housing for all people in a community.

Generally, housing is deemed affordable when it comprises no more than 30% of a household’s budget. For most metrics, that includes mortgage or rent plus utilities. According to the N.C. Housing Coalition, more than 25% of all households in the Triangle don’t meet that criteria. That means more than 170,000 households in Wake, Durham, Orange and Johnston counties face a cost burden to put a roof over their heads.

Housing Costs, Household Income Impact Crisis

It’s easy to look at housing costs as the culprit. And certainly it’s a contributing factor. But household incomes play an equally important role. After all, if income growth outpaces even a fast-growing market, households won’t feel a pinch.

“And so we have to have a real conversation about what’s happening with people and their incomes, upward mobility, job opportunities,” said McKoy.

In the Triangle, household incomes have increased by about 18% since 2011. That’s less than 3% each year during a time of massive economic expansion. For comparison, the S&P 500 stock market index increased by 158% in those years. The majority of economic gains have concentrated at the upper ends of the income spectrum, widening income inequality.

“If all the resources are going to the top, and none of them are staying at the bottom, then what does that mean for the future of society?” said McKoy. “And I think right now we are in some perilous times.”

McKoy’s sentiment is felt acutely at places like the Women’s Center of Wake County, where people like Renate Laredo have turned as a last resort. On a recent visit, she told a story of how she first saw her hours cut from a job at a discount store, before she lost that job altogether. That left her short on rent money.

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