As home prices and rents have skyrocketed in recent years, that so-called 30% rule is increasingly challenging to follow. Almost half - 49.7% - of American renter households spent more than 30% of their income on housing costs, according to data from the US Census Bureau. This statistic, unchanged from 2022, indicates a persistent housing affordability crisis that continues to impact a significant portion of the rental population.
In New York City, the average renter has to make almost double the city's median income to abide by the 30% rule, with about a third spending half their income on rent. This exemplifies the extreme affordability challenges faced by urban renters, particularly in high-cost areas.
African-American renters are the most frequently cost-burdened, with 56% spending more than 30% of their income on rent. The Hispanic population follows at 53%, while 47% of white renters also experience similar burdens. This data underscores the racial disparities prevalent in housing affordability.
Renters are currently struggling more than homeowners, as rents rose faster than home prices for the first time in a decade, ultimately placing greater financial strain on tenants. Meanwhile, homeowners are also grappling with high mortgage interest rates, rising insurance premiums, and other costs.
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