Low-income Americans can no longer afford rent, food, and transportation

Actually, many Americans have long been unable to afford rent, food, and transportation. It's just worse today.

A factor they didn't mention was zoning laws blocking affordable housing from being built.

http://www.vox.com/2016/3/30/11330832/low-income-households-cant-afford-basic-needs

Updated by Soo Oh on March 30, 2016

Low-income Americans are experiencing a staggering price hike in housing costs — a change that makes it sometimes impossible to afford basic necessities.

A new Pew Charitable Trusts analysis of data from the Bureau of Labor Statistics shows that in 2013, low-income Americans spent a median of $6,897 on housing. In 2014, that rose to $9,178 — the biggest jump in housing spending for the 19-year period of data that Pew studied.

The cost of other necessities, like transportation and food, also rose, albeit not as dramatically. 2014 was the first year that Pew studied in which median spending on these three categories was higher than the median income for those in the lower third of income groups.

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"Lower-income renters are spending nearly half their income on rent, while upper-income groups spend about 15 percent on rent. The disparity really shows that lower income families don’t have much slack in their budgets for mobility-enhancing investments like savings and wealth building."

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The rise in housing costs was particularly drastic for low-income Americans. For middle and high earners, the increase was noticeable but smaller, about 6 to 9 percent in 2014. Their budgets also had a lot more slack; basic necessities didn't even come close to consuming nearly half their income.

Median incomes decreased across the board, though there was still room in their household budgets to return expenses to pre-recession levels. The average upper-income household spent nearly three times as much a month on entertainment spending as its lower-income counterpart.

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So what's going on? The basic story seems to be that after years of financial crisis and recession, a large share of Americans are simply too burdened by low wages, past foreclosure, depleted savings, and overhangs of other debts (student loans, medical bills, etc.) to buy starter homes. And while investors were willing to pick up vacant or bank-owned single-family homes for pennies on the dollar during the peak slump years to operate them as rentals, nobody is excited enough about the business of operating single-family rental homes to actually go out and build vast new tracts of modest-size single-family homes destined for the rental market.