Study Shows Share of Rent-Burdened Households Declining, Affordability Challenges Remain
A recent report by the NYU Furman Center entitled “2017 National Rental Housing Landscape: Renting in the Nation’s Largest Metros” examined rental housing trends from 2006 to 2015 in the 53 metropolitan areas with populations over one million in 2015, with a particular focus on the economic recovery period beginning in 2012.
The report found that the share of rent-burdened households—those that spend more than 30 percent of their income on housing—in the nation’s 53 largest metro areas dropped by 1.2 percent to 47.7 percent between 2012 and 2015. Despite positive signs, the report also shows that the number of rent-burdened households is still far above pre-recession figures, and rent grew faster than inflation in nearly every major metro area.
The report also shows that rents continued to rise, and rose more quickly in metros that already had high rents. The income of the typical renter household increased along with overall incomes in the economic recovery period, but more of the renter households were highly educated, had higher incomes, and were employed. Therefore, not all of the measured increase in renter income was due to renters making more income per se; rather, part of it was due to a shift in who was choosing to rent.
Although the report shows that the share of rent-burdened households declined recently in most metros, it points out that this fact masks affordability challenges for lower income renters, particularly those who have not benefitted from the general rise in incomes that come with falling unemployment rates. These include retirees and others on fixed incomes or who are not in the labor force. As rents continue to rise in most metros, the report points out that those renters may experience only the rent increases without the benefit of rising incomes.