Recent Report Reveals Escalating Housing Cost Burdens for Renters

July 19, 2024 | by Michael Wilt

Categories: Affordable Housing, Construction, Homelessness, Rental Housing

Earlier this year, the Joint Center for Housing Studies at Harvard University released the 2024 America's Rental Housing report which documents the state of the rental market and how renters are faring with the ever-changing conditions.

The primary takeaway is that while rental markets are cooling down across the country due to increased housing production, renters are increasingly cost burdened, homelessness is on the rise, and aging properties need extensive investments for structural repairs, accessibility improvements, and climate resiliency.

more renters than ever are cost burdened

Perhaps the most startling finding is that half of all renters are housing cost burdened, meaning they contribute more than 30 percent of their income to housing costs. This represents a record high 22.5 million cost burdened renters, an increase of 2 million since 2019. An additional 12.1 million households are severly cost burdened, meaning they spend more than half their income on housing costs.

When households spend more on housing, they have less to spend on basic necessities. The report notes that the most severly cost burdened households spent 39 percent less on food and 42 percent less on healthcare than unburdened households.

Cost burdened households also have little in the way of savings. For the 32 percent of renters whose incomes are below $30,000, they had an average of $300 in savings and an estimated total net wealth of just $3,200.

rental production is up but the number of affordable units is shrinking

As of 2022, there were 48.1 million rental units, and nearly 10 percent were built since 2010. However, over the last decade, the supply of units with rents below $600 plummeted by 2.2 million units.

The affordable and available units that remain often need structural repairs, safety upgrades, and improvements to protect them from environmental and climate-related threats. In 2021, 8.4 percent of renters lived in a community with substandard living condition like unreliable electricity and water. Moreover, 41 percent of renters reside in a rental home subject to environmental and climate hazards.

homelessness on the rise

As of January 2023, an all-time high 653,100 people were unhoused, an increase of 71,000 over one year. This is primarily due to expiring pandemic-related measures like eviction moratoriums and emergency rental assistance programs.

Households at risk of homelessness may qualify for rental assistance based on income, but assistance is limited and can only meet a fraction of the demand. The report estimates that there are 14.1 million households that qualify for assistance but don't receive any, which equates to 75 percent of income-eligible households left unassisted.

We recommend reading the full report for a detailed analysis of the above data and other takeaways. Moreover, the report's landing page has helpful interactive maps and data that provide a synopsis of many of the key findings.

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