Many residents of Rapid City have a hard time finding housing that is safe and affordable for themselves and their families. The 2011 Community Needs Survey shows that 72 percent of the survey respondents cited affordable housing as a problem for Rapid City.1 Media stories have also reported that affordable housing is a problem.
Rapid City is required to prepare a five-year Consolidated Plan to receive federal funding for housing and community develeopment programs. The latest Consolidated Plan for Rapid City states that 27 percent of households in Rapid City have at least one of the HUD targeted housing problems of substandard housing, overcrowding, housing cost burden, or having zero or negative incomes.2 The plan states that almost 25 percent of all households are housing cost burdened, defined by the U.S. Census Bureau as paying more than 30 percent of household income for housing. Furthermore, severe cost burden (defined as paying more than 50 percent of gross household income) affects 11 percent of the cost burdened households. The plan also states that Rapid City and Pennington County have the highest fair market rental housing cost burden in South Dakota and a disproportionately lower mean hourly wage, both factors in creating an affordable housing problem.
The 2012 American Communties Survey (ACS) by the U.S. Census Bureaus shows that Rapid City residents have a lower housing cost burden than the national average.3 Nationally, 34 percent of homeowners with mortgages and 52 percent of renters spent more than 30 percent of their household incomes on housing. In Rapid City, 27 percent of owners with mortgages and 45 percent of renters had a housing cost burden. Rapid City residents had a higher housing cost burden than Sioux Falls residents. In Sioux Falls, 25 percent of owners with mortgages and 46 percent of the renters were housing cost burdened.
Furthermore, as the Consolidated Plan stated, Rapid City residents have a lower household income comparatively to the national average and to other cities in South Dakota. According to the 2012 ACS, the median household income for Rapid City residents is $44,626 and the national average is $51,371. In Sioux Falls, the median income of households is $48,261.
The 2012 ACS showed a greater income disparity in Rapid City than in Sioux Falls. In Rapid City, 12 percent of households had income below $15,000 and six percent had income over $150,000 or more. In Sioux Falls, nine percent of households had income below $15,000 a year and five percent had income over $150,000 a year. Nationally, there is greater income disparity with 13 percent of households having income below $15,000 and nine percent with income over $150,000.
The 2012 ACS also shows that the housing supply in Rapid City was lower than the national average. The vacancy rate for housing units in Rapid City was 9 percent compared to 12 percent nationally. In Sioux Falls, the vacancy rate was 8 percent. The 2012 ACS also shows that Rapid City has a greater percentage of renters at 44 percent compared to the national average of 36 percent.
The 2012 ACS also reported that the median monthly housing costs in Rapid City was $1,272 for homeowners with mortgages and $760 for renters. This was below the national average of $1,460 for homeowners with mortgages and $884 for renters. In Sioux Falls, the median monthly housing costs for homeowners was $1209 and $724 for renters.
Fewer of the mortgage holders (27 percent) in Rapid City are housing cost burdened compared to renters (45 percent) in Rapid City. However, more households in Rapid City rent (44 percent) than in Sioux Falls (42 percent) and nationally (36 percent).
The Consolidated Plan states that in order to afford a two-bedroom apartment in Rapid City, a household must earn $2,597 per month or $31,160 per year. The 2012 ACS data shows that approximately 35 percent of households in the Rapid City area have incomes below $35,000 per year.4
1. Alman, R., Eppen D., & Usera, J. (2011). Black Hills Community Needs Assessment 2011. Rapid City, S.D.: South Dakota Public Policy Institute. Retrieved from http://www.rcgov.org/pdfs/Community-Development/Community%20Needs%20Assessment/BHCNA%20Report%202011%20Version%202.0.pdf↩
2. City of Rapid City, Community Development Division. (2013). Consolidated Plan & FY 2013 Annual Action Plan-Year One. Retrieved from http://www.rcgov.org/pdfs/Community-Development/2013ConsoldPlan/FINALPROOFEDSUBMISSIONDOCUMENT07222013.pdf↩
3. U.S. Census Bureau. American Community Survey. (2012) American Community Survey 1-Year Estimates, Narrative Profile NP01. Retrieved from http://factfinder2.census.gov↩
4. U.S. Census Bureau. American Community Survey. (2012) American Community Survey 1-Year Estimates, Selected Economic Characteristics, DP03. Retrieved from http://factfinder2.census.gov/bkmk/table/1.0/en/ACS/12_1YR/DP03/312M100US396604652980↩