Tenants Pass on Dental Care as Rents Keep Rising
Guest Post By: Jennifer Riner
Rent is at an all-time high in many major cities. While homeowners in the U.S. only spent 15.1 percent of their total uncome on their mortgages this past summer, renters spent twice as much at 30.2 percent, the highest ever in history. With such high living costs for renters, 40 percent of Americans put off getting essential dental care in order to pay their rent.
Why Dental Care?
Dental care is by far the most skipped out form of health care. Still, according to the Federal Reserve Board Survey of Household Economics and Decision-Making, 2014; American Community Survey, 2013, 25 percent of Americans who rent said they were unable to see their doctor because of their high rent burden. Approximately 23 percent of Americans said they failed to fill their prescription medications, and less than 20 percent were able to see a specialist, obtain follow-up care or get mental health care because they couldn’t afford both healthcare and their rent.
Dental care is often overlooked because it’s primarily preventative. When you visit a medical doctor, it’s usually because you’re sick or hurt. Individuals don’t feel the same pressure to get their teeth cleaned and checked since a lack of preventative care doesn’t immediately lead to pain or severe symptoms. But, according to the American Dental Hygienists Association, every dollar spent on preventive dental care could save up to $50 in restorative and emergency treatments down the road.
Where Else Are Renters Cutting Back?
Dental care isn’t the only expense American renters can’t afford. In fact, according to Zillow, renters with a high burden (meaning they spend more than 30 percent of their income on housing) have a median savings of zero. So although homeownership is widely affordable, renters struggle to save for down payments and can’t benefit from historically low interest rates and diminished competition. They are stuck in a renting rut where each year seems to be getting more expensive, especially for coastal cities like New York and San Francisco.
The problem lies in the fact that rents are continuing to rise while incomes remain stagnant. From 1985 to 1999, in New York City, people typically spent 25.3 percent of their incomes on rent. But by early 2015, NYC lessees spent 41.7 percent of their incomes on rent, just trailing Los Angeles where rent takes up 48.7 percent of the household income.
One of the biggest drivers of extreme prices is lack of supply and increasing demand in many major cities throughout the country. Chicago’s prices are fairly low, especially for being the third largest city in the United States, primarily due to the fact that a large percentage of new infrastructure is dedicated to rental housing. By keeping supply high, there’s less competition amongst lessees, taking the power away from landlords to raise prices at an astronomical rate. Almost 60 percent of renters said they could not cover three months of living expenses in case of a financial emergency.
Although it may seem difficult with high housing costs, putting money aside for medical necessities like dental care should be at the top of a tenant’s priority list. If you’re trying to save money to purchase a home and benefit from low mortgage rates, you may want to put that on hold until you have a large enough emergency savings to cover you and your family in case of a crisis.
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