National Apartment Report: September 2016

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Graphic: Where is rent increasing and decreasing the most?

National Apartment Report

*Data provided by ABODO – Data based on apartments available to rent

Nearly Half of U.S. Renters, Even Rural, Are Cost-Burdened by Housing

Price is the most important factor for those seeking a home, whether they’re looking to buy or rent, yet affordable housing remains increasingly difficult to find. According to recently released analysis, nearly half of renters are cost-burdened.

Recently, the Joint Center for Housing Studies of Harvard University used the most recent American Community Survey data available to paint a picture of housing costs around the country. The JCHS reports that 49.3% of renters in 2014 — totaling 21.3 million people — were cost-burdened, meaning that at least 30% of their income went to rent and utilities. Nearly a quarter of renters, 22%, were severely cost burdened, spending at least 50% of their income on housing costs.

Still, housing costs continue to increase. ABODO’s data shows that over the past month, those increases were mainly felt in Miami and Bakersfield, CA, which both saw their rent rise 9% since August. A one-bedroom in Miami now goes for $1,739 (up from $1,599), and in Bakersfield it’s $725 ($669).

Two other California cities also saw some of the country’s largest rent hikes for September, with Fresno up 6% and San Diego up a gentler 2%. Philadelphia rent jumped 7%, from $1,291 in August to $1,379 in September. Detroit, Minneapolis, Memphis, and St. Louis also saw higher rents for September leases.

Although three California cities saw rent hikes, several of the state’s large metro areas also enjoyed some of the largest rent decreases, with average San Jose rent dropping from $2,790 to $2,455 — a 12% difference. Los Angeles also dropped 8%, Long Beach 7%, and San Francisco 6%.

Seattle takes the lead, however, for the nation’s largest rent decrease, down 13% from $2,170 to $1,890. Boston and Charlotte saw 7% decreases, and Chicago, Baltimore, and Lexington were close behind with 6%.

Nationwide, the average rent for a one-bedroom in August was $932. In September, that crept up to $940. It’s a small difference, but it shows that even though large metro areas saw more significant rent decreases than increases last month, the nationwide trend is still upward — meaning rural communities and smaller cities could be bearing the burden.

JCHS reports that 41% of rural renters are cost-burdened, especially in rural counties adjacent to coastal metro hubs, where property values are higher and residential land is limited.

For example, the small city of Kingston, NY, just two hours north of New York City, is home to roughly 24,000. Among renters, 67.3% are cost burdened, paying about $1,000 monthly for housing on an average household income of $27,900. In Kingston — ranked by JCHS as the nation’s #1 most-burdened metro- or micropolitan area — 39% of renters are spending at least half of their income on housing.

Compared to 2010, when just over 30% of rural renters nationwide were cost burdened, these numbers are staggering.

Although homeowners feel the squeeze as well, it’s generally to a lesser extent, and the number of cost-burdened homeowners is growing more slowly. In 2010, about 18% of homeowners were cost-burdened, creeping up to about 22% by 2014.