Census Bureau Says Almost Half of Renters Are Cost-Burdened
The Census Bureau says that nearly half of renter households — 49.7% of 42.5 million renter households — are cost-burdened, paying at least 30% of their income.
That many households face heavy financial burdens isn't exactly news. Earlier this year, the Harvard Joint Center for Housing Studies said that in 2022, half of renters were cost-burdened. Even then, while there was a slowdown in rent growth, renters still had to meet accumulated high costs.
But conditions have been getting worse. The real median gross cost of renting — that includes costs of utilities and fuels adjusted for inflation — grew at 3.8% in 2023, even as real median home values grew by only 1.8%. That was the largest annual rent increase since at least 2011. Between 2011 and 2019, real rent costs were up by less than 3.0%. The median cost of rental housing grew from $1,354 to $1,406 after adjustment for inflation.
Six states — Illinois, Kansas, Minnesota, New Mexico, New York, and West Virginia — saw declines in the share of renters' incomes going toward rent. On the other hand, Arizona, Florida, and Georgia all saw the shares of household incomes going into rent.
Overall, renter household income does seem to have kept pace as the portion of their income spent on rent and utilities stayed at 31.0% last year. Median household finally achieved an important milestone by returning to what incomes used to mean before Covid-19 and taking inflation into account.
The percentage of households that were cost-burdened varied by race. Among Asian alone renter households, 43.4% were cost-burdened; 46.7% of whites were; as were 48.8% of American Indian or Alaska Native; 51.7% of Native Hawaiians or Pacific Islanders; 56.2% black households; 53.2% of Hispanics; and 51.4% of two or more races.
The number of renter-occupied housing units increased by 0.9% in 2023. That might be because of the increase in house prices and the greater difficulty in owning a house, including expenses like insurance. Of the 85.7 million homeowners in the U.S., 5.4 million of them paid at least $4,000 a year for coverage. More people had no option but rental housing.
Source: GlobeSt/ALM