Nearly Half of U.S. Renters Are Burdened by Housing Costs
Over the past ten years, the American economy has been on a rapid rise, yet more and more people are struggling to afford rent. According to the new report published by Apartment List, almost half of American renter households can be classified as cost-burdened, spending more than the recommended 30% of their incomes on rent.
As of 2017, the share of cost-burdened renters was the highest in Florida with 56.4%.
Cost burden rates tend to be highest in coastal areas with high housing costs. Miami has a cost burden rate of 62.7% the highest of the nation’s 100 largest metros. However, that rate is generally decreasing. Just within the last year, it decreased from 62.8% in 2016 to 62.7% in 2017.
At the state level, Florida has the highest cost burden rate at 56.4%. Nearly one in three cost-burdened renters (30.8 percent) lives in California, New York or Florida. Out of all Southeastern states, Florida also has the highest rate of severely cost burden renters at 28.8%, which means that they spend over 50% of their householdAll the people who occupy a housing unit. A household includes the related family members and all the unrelated people, if any, such as lodgers, foster children, wards, or employees who share the hous... More income on rent.
The Carolinas, KentuckyHome to the Mammoth Caves, KFC, bluegrass music, and the Kentucky Derby. Birthplace of Johnny Depp, Jennifer Lawrence, Bill Monroe, Abraham Lincoln, and bourbon whisky. These are just a few of the thi... More, GeorgiaOver the past few decades, the State of Georgia has gone from being primarily an agricultural region to being an international crossroads and one of the most influential regions of the Southeast. Now ... More, and Maryland have seen an increase in cost burden rates in their capital metropolitan areas.
Other states have seen an increase in cost burden rates since 2016. In Columbia, SC the numbers increased from 49.8% in 2016 to 51.1% in 2017. The metro has the #31 highest cost burden rate of that nation’s 100 largest metros. The cost burden rate in Frankfort, KY increased from 30.8% in 2016 to 39.7% in 2017. This is less than the national average of 49.5%.
Cost burden rates have been increasing in Atlanta, GA, placing it in 47th place out of 100 national metros. The numbers have increased slightly, from 48.4% in 2016 to 48.6% in 2017. Overall, Maryland also had a significant increase in cost burden with a jump from 48.9% to 50.0%.
Despite an increase, Raleigh, NC has the nation’s #8 lowest cost burden rate. The cost burden rate in Raleigh increased from 42.1% in 2016 to 42.5% in 2017. Raleigh has the #8 lowest cost burden rate of nation’s 100 largest metros. 17.7% of renter households in Raleigh are severely cost-burdened, while 24.8% are moderately burdened. The of cost-burdened renter households in Raleigh has increased by 13,787 since 2007.
AlabamaFrom the rolling mountains of the north to the pristine Mobile Bay and the Gulf of Mexico, Alabama is a state with natural beauty all its own. Since it was first settled, Alabama has largely been a ru... More, TennesseeLocated in the nation's heartland, the State of Tennessee is a land as rich and diverse as the people who live there. In fact, Tennessee residents think of their state as divided into three Grand Divi... More, Virginia, and West Virginia saw a decrease in the cost burden rate of their capital metropolitan areas.
Montgomery, AL has the nation’s #35 lowest cost burden rate of the nation’s 100 largest metropolitan areas, with the numbers falling drastically, from 57.1% in 2016 to 53.5% in 2017.
Nashville, TN had a noticeable decrease from 44.6% in 2016 to 43.8% in 2017. Currently, the metro is ranking as the #13 lowest cost burden rate.
In Virginia, Richmond’s cost burden rate also decreased from 50.6% in 2016 to 37.7% in 2017. Richmond has the #35 lowest cost burden rate. In Charleston, WV placed in 35th place, with rates also decreasing, from 50.2% in 2016 to 42.3% in 2017.
Rents rising across cities in Southeastern metropolitan areas.
Rent growth in the Southeast has been relatively stable over the past year. Compared to most similar cities across the country, Southeast is more affordable for renters. In North Carolina, Wilmington, Asheville, and Cary have all experienced year-over-year growth above the state average (3.5%, 2.7%, and 2.2%, respectively). Atlanta rents have remained flat over the past month, however, they have increased slightly by 1.5% year-over-year. In Florida, Miami rents have increased 0.8% over the past month, and are up marginally by 0.8% in comparison to the same time last year. Throughout the past year, rent increases have been occurring not just in the city of Miami, but across many metros across the Southeast.
Luckily, the number of rent-burdened households has started to fall and is currently lower than the 2014 peak by 774,000 households. That said, the total number of rent-burdened households remains higher than the 2007 level by 3.1 million households.
At last, Apartment List explored the relationship between income growth and cost-burden increase. Below is a chart that demonstrates that when income growth outpaces rent growth, cost burden rates will tend to fall.
A lack of affordable housingIn general, housing for which the occupant(s) is/are paying no more than 30 percent of his or her income for gross housing costs, including utilities. Please note that some jurisdictions may define af... More in areas of economic opportunity remains one of the most pressing issues. Households that struggle to pay rent oftentimes have to cut back other basic necessities, which can result in adverse and long-lasting consequences. While the data do show some improvement, there is still much left to do to ensure that everyone can afford a place to live.