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U.S. Rents Have Increased 50% More Than Wages Since 2019, Need $80K Salary To Rent

U.S. Rents Have Increased 50% More Than Wages Since 2019, Need $80K Salary To Rent

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Photo by cottonbro studio

Rents are too damn high. Political activist James McMillan III, founder of the Rent Is Too Damn High Party, a New York–based political party, stated a few years ago. And it is even truer today.

Between 2019 and 2023, rents jumped 30.4 percent nationwide, outpacing the 20.2 percent rise in wages during the same period, according to a recent analysis by Zillow and StreetEasy. In some cities, rent increases were 50 percent more than wages.

Cities where renters are feeling the financial squeeze include Atlanta, Baltimore, Cincinnati, Las Vegas, New York, and San Diego. The pandemic triggered a surge in rent prices as Americans left urban centers for more spacious suburban and rural areas. Although the rate of rent increases has slowed recently, housing experts say the overall trend remains upward, Zillow reported.

“New multifamily buildings coming online have eased competitive pressure in many markets, but in New York City construction just simply can’t keep up with demand,” StreetEasy Senior Economist Kenny Lee told CBS News. Despite some metros, like Austin and Portland, experiencing rent decreases in the past year, more populated cities like New York are heading in the opposite direction.

As of March, the median U.S. rent rose to $1,987, up 0.8 percent from the previous year, according to Rent.com. The increase is partly driven by strong demand from millennials and Gen Z adults, many of whom have been priced out of the housing market. Renting remains a more affordable option than owning a home in many major U.S. cities, according to a recent Bankrate study.

To comfortably afford the typical U.S. rental price of $1,997 as of April, a renter would need an annual income of nearly $80,000 ($79,889), assuming they spend no more than 30 percent of their income on rent. This figure marks a significant increase from five years ago when an income of less than $60,000 ($58,692) was sufficient to afford the typical rent.

Photo by cottonbro studio: https://www.pexels.com/photo/a-man-sitting-on-the-couch-while-talking-on-the-phone-8572164/