The High Cost of Living in Vermont is a Poverty Driver

by Robert Maynard

Vermont consistently ranks among the most expensive places to live in the U.S. and that factor plays a major role in our problem with poverty.  A recent report by CNBC reminded us that we seem to be making little headway in dealing with this issue.  According to the report Vermont is the 9th most expensive state to live in.  Here are some of the prices listed  for various items here in Vermont: House: $394,512, Movie ticket: $9.19, Rent: $1,354, Doctor visit: $102.50, Gallon of gas: $3.494, T-bone steak: $8.75

This problem seems to be a continuous trend in our state.  The Real Estate Rama, a publication dealing with government and public real estate news, published an April 2010 article, which pointed to the same problem:  “For Vermont’s renters, the news isn’t good. Rural Vermont ranks in the top 10 most expensive rural areas in the nation. Vermont’s “Housing Wage” has risen to $17.70 per hour, or $36,812 per year. This represents an increase of 54% since 2000. The national Housing Wage is $18.44 in 2010.”

As the article points out, Vermont’s high rental costs are a factor driving poverty in the state:

“With rents continuing to climb further out of reach, homeless shelters have become the housing of last resort for Vermont’s working poor and people living on fixed incomes,” said Melinda Bussino, Director of the Brattleboro Area Drop-In Center and Co-Chair of the Vermont Coalition to End Homelessness. “This report underscores the need for the State to provide sufficient funding for affordable housing, homelessness prevention and other safety net programs.”

Vermont’s rental housing market has been among the Nation’s tightest for several years. Low-vacancy rates help push rents upward. That, combined with the fact that many Vermonters work in relatively low-wage jobs, creates enormous pressures for thousands of households in the Green Mountain State struggling to pay for necessities.

The situation for Vermonters with disabilities living on Supplemental Security Income (SSI) is absolutely dire: with a monthly payment of only $726, they can afford no more than $218 for their housing costs—severely short of the $751 FMR for a one-bedroom apartment, or even the $655 FMR for a studio apartment.

Again, the problem does not seem to be getting any better.  Even in a recession, when prices tend to lower, Vermont’s renters saw no relief:

Even during a time of economic downturn, when rents could normally be expected to decline, decent affordable housing has remained out of reach for many Vermonters. The inability to afford housing has pushed many new families and individuals into homelessness. This year’s Point in Time Count, conducted on January 27, counted approximately 2,800 homeless Vermonters statewide. This number reflects a sharp rise in homelessness in recent years – a 25 percent increase since 2008. The Point in Time Count is a 24-hour count of the homeless coordinated by the Vermont Coalition to End Homelessness and the Chittenden County Homeless Alliance and conducted by service providers throughout the state.

In fact, rental prices actually continued to increase, as this April 2011 Vermont Digger article points out:

The national economy might be improving, but Vermonters still struggle to afford rent, according to a 2011 report from the Vermont Housing Finance Agency. A panel of state lawmakers and housing authorities painted a bleak picture of the future of affordable housing and warned that cuts in the federal budget could worsen an already dire situation, at a press conference at the Statehouse Thursday.

“Rental housing doesn’t seem to be aware that there’s a recession going on,” said Sarah Carpenter, executive director of the Vermont Housing Financing Agency. Citing stagnant income, low vacancy rates, and a 7 percent increase in rent over the last year, the report found a “growing gap” between wages and rental costs.

Numerous news outlets have pointed to the problem Vermont has with its high cost of living, including high housing costs, but few seem to be connecting this problem with Vermont’s restrictive regulatory policies.  I have talked to friends in the business of building houses and have been told repeatedly that it is prohibitively expensive to build new houses in Vermont due to the state’s excessive regulations.  Our political leaders put in place policies, which ensure that building houses is more expensive than other housing markets, and then turn around and argue that we need to spend more taxpayer’s dollars to enact programs to create affordable housing.  This is kind of like having firemen start a fire and then come and claim that you need to pay them to put it out.

3 thoughts on “The High Cost of Living in Vermont is a Poverty Driver

  1. Property Tax Reform is sorely needed. No question high property taxes unfairly target homeowners and indirectly renters and contribute to property loss if unable to pay for pennies on the dollar by local town officials. Even the Pro Tem of the senate suffered tax sale without being told and he is a lawyer. Why is that OK especially when it happens to poor neighbors or ourselves.

  2. Raising the cost-of-stay is Montpelier policy. It offers the twin benefits of driving out the middle-class who are most likely to vote against expansion of government regulation and taxation, and it creates a dependent under-class which gratefully votes for “free stuff”.

  3. I moved to VT 35 years ago because I loved the state and saw opportunity. Rents and housing cost where low as where taxes.
    Now it has gone out of control. Our Congressman Peter Welch keeps say we will do things”the Vermont way” . What is that make it impossible for the working class person live a comfortable life? Or is have them get on welfare or subsidized housing so the Government has control? Something to think about!

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