More than 40% of renters reported spending more than 30% of their income on rent between 2017 and 2021.
The Department of Housing and Urban Development describes affordable housing as spending “no more than 30% of gross income for housing costs, including utilities.” The U.S. Census reported that 19 million renter households are considered burdened by their housing costs, spending at least 30%, if not more, on their housing. The report found that 7.6% of counties, with around one-third of total renters in the U.S., had a median housing cost ratio for renters above 30%. In less than 1% of counties, homeowners who have a mortgage had a median housing cost ratio above that of renters.
As wage growth continues to lag behind rent price growth and homeownership costs, many consumers are struggling. Median income from 2017 to 2021 increased 10.5% compared to the 2012-2016 period. Comparing the same time periods, 42% of all counties had an increase in household income. Nearly three-quarters of counties had a median household income below the national median ($69,021 between 2017 and 2021) and only 13.2% of all counties had a median household income higher than the national median. Despite financial hardships over the past few years, the level of poverty fell 2.5% and 38.8% of counties had decreasing poverty rates, while 2.4% had increasing poverty rates.
There were some household changes between the 2012-2016 period and the 2017-2021 period. The number of households with one or more children under 18 fell from 32% to 30.6%, while the number of households with one or more people 65 or older grew from 27.4% to 30.2%. Additionally, the number of grandparents responsible for their grandchildren under 18 in their household fell from 36.5% to 32.7%.
Even though rent prices are not rising as rapidly as they were throughout 2022, consumers are still struggling to afford one of the most basic needs – housing.