Why the Rent Feels Too Damn High—in 1 Graph

The young and poor who rent their homes have been crunched both by rising housing costs and falling incomes.

During the tech boom, rents and incomes rose together. After the tech bust, they came apart, with the median cost of rent (in orange) continuing its upward trajectory, even as the incomes of renters (in purple) tumbled. As a rule, renters skew young and poor. The runaway cost of housing has made them feel poorer still, as this graph shows, from a new report by Harvard's Joint Center On Housing Studies

The result is that according to the latest data, about half the 40.6 million American households that rent their home are what economists consider "rent burdened," meaning they spend at least 30 percent of their income on housing. More than a quarter are "severely rent burdened," meaning they spend at least 5o percent of their income on housing.

There are a whole ebooks to explain why rents have continued to rise. But here are two big ones highlighted by the Harvard study: First, vacancy rates have fallen, in part thanks to the foreclosure crisis, which dumped many families back into the rental market. With less supply comes higher prices.

Second, low-cost rental properties have been disappearing from the market—they tend to be older and on the more decrepit side, which is why they're cheap—only to be replaced by newer, more expensive units. That's good for the quality of U.S. housing, but bad for affordability.

Presented by

Jordan Weissmann is a senior associate editor at The Atlantic.

Google Street View, Transformed Into a Tiny Planet

A 360-degree tour of our world, made entirely from Google's panoramas

Join the Discussion

After you comment, click Post. If you’re not already logged in you will be asked to log in or register.

blog comments powered by Disqus

Video

Google Street View, Transformed Into a Tiny Planet

A 360-degree tour of our world, made entirely from Google's panoramas

Video

The 86-Year-Old Farmer Who Won't Quit

A filmmaker returns to his hometown to profile the patriarch of a family farm

Video

Riding Unicycles in a Cave

"If you fall down and break your leg, there's no way out."

Video

Carrot: A Pitch-Perfect Satire of Tech

"It's not just a vegetable. It's what a vegetable should be."

Video

The Benefits of Living Alone on a Mountain

"You really have to love solitary time by yourself."

More in Business

Just In