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Rent is Too Expensive (And it’s Probably Going to Get Worse)
April 29, 2014
Half of all renters in the U.S. are moderately or severely financially burdened by the cost of their housing. At an event in December 2013, HUD Secretary Shaun Donovan called this ‘the worst rental affordability crisis that this country has ever known.’
A recent article in the New York Times highlighted the soaring rents, saying that rents are ‘out of reach’ for America’s middle class. Housing costs are considered affordable if they don’t exceed 30 percent of household income. If middle class Americans are having trouble affording rent, imagine the challenges for people in poverty trying to get housing. In fact, people with low incomes spend the majority of their income on housing.
It’s often assumed that unaffordable rent is a problem in metropolitan areas that have been known to have high housings costs. But this isn’t just a “big city” problem. According to "Out of Reach 2014" by National Low Income Housing Coalition, “between 2000 and 2010, the number of cost burdened rural renter households increased by ten percentage points.”
From 2007-2013, the number of renters increased by 6.2 million. Based on a report by the Joint Center for Housing Studies of Harvard University, there are more renters now compared to about 10 years ago, and families are just about as likely to rent as single people. Rental vacancy rates continue to decrease, and rents continue to increase. Rents are estimated to rise by upwards of 4 percent during 2014 compared to last year’s increase of 2.8 percent.
What are people doing to curb the high housing costs? Doubling up. Several of the most expensive states as identified in Out of Reach 2014 had increases in doubled up households. What’s the connection to homelessness? High housing cost burden places people at risk of losing their housing, and living doubled up is often people’s living situation before they become homeless.
Graphic source: Joint Center for Housing Studies of Harvard University, "America's Rental Housing: Evolving Markets and Needs."