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Comprehensive Plan Housing Element however, important to consider the components of housing cost, because addressing housing cost is one way to address the housing affordability problem. Of all the factors affecting housing cost, market demand is probably the most significant. In coastal Florida, there has long been a high demand for housing from affluent retirees and second home buyers. This demand has increased the cost of land and housing units in the coastal areas of Florida more than in non -coastal areas. During the 2004 to 2006 period, however, market demand was more influenced by investors, speculators, and sub -prime lending practices. These factors resulted in artificially inflated demand for housing and a corresponding increase in housing prices. While market demand was a significant component in the 2000 to 2006 housing cost increases, other components contributing to the rise in housing prices included construction cost increases, property insurance increases, and high property taxes. After the hurricanes of 2004 and 2005, property insurance rates doubled or tripled. Construction costs, particularly concrete prices and roofing material prices, also significantly increased after the hurricanes. With the increase in housing values, property taxes significantly rose for those residents not protected by the Save Our Homes law. Also affecting housing cost is government regulations. Regulations increase development costs and thereby the cost of housing. Some of these cost increasing regulations include enhanced landscaping and buffer requirements, additional open space requirements, and new bonding requirements. Finally, government imposed impact fees also raise housing costs. Just because government regulations and fees increase housing cost, however, does not warrant eliminating those regulations or fees. Most regulations address safety or aesthetics, while fees cover costs incurred by feepayers. If regulations are eliminated, community goals may not be met. If fees are eliminated, costs are shifted to other payers. Recently, housing costs have declined. By January 2009, the median sale price for homes had decreased to $114,900, a 56% reduction from January 2006. While housing costs significantly decreased from 2006 to 2009, median household income for the county increased from $55,500 to $58,300 during that period. - Household Income and Housing Cost According to the National Low Income Housing Coalition (NLIHC)'s 2006 Outreach report, the Fair Market Rent (FMR) for a two-bedroom apartment in Indian River County was $734 in 2006. In order to afford this level of rent and utilities without paying more than 30% of its income for housing, a household must earn $2,247 monthly, or $29,360 annually. Assuming a 40 hour work week, 52 weeks per year, this level of income translates into a hourly wage of $14.12 for a one worker household. In Indian River County, a minimum wage worker earns an hourly wage of $6.40 in 2006. To afford the Fair Market Rent (FMR) for a two-bedroom apartment, a minimum wage earner must work 88 hours per week, 52 weeks per year. Or, a household must include 2.2 minimum wage earners working 40 hours per week year-round in order to make the two bedroom FMR affordable. 19 Community Development Department Indian River County