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"44 Million Americans Are On The Brink Of Eviction
As They Can't Afford Rental Prices"
by Epic Economist
"If you’re a renter, are you also feeling the pinch of rent prices right now? With mortgage rates soaring and forcing many would-be homebuyers to back out of the housing market over the past year, demand for rentals is at the highest level on record, according to data from Realtor.com. As of January 27, less than 6% of rental units were sitting vacant in the U.S. rental market. And along with demand, rent prices are still at historic highs despite recent declines seen around the country that ranged from 2% to 6%. In fact, one new study found that expensive rental costs are now burdening 44 million Americans from all over the nation. For the bottom 10% of income earners, rents are unaffordable in virtually every state of the country. Meanwhile, eviction rates are rising fast, and this time around, there are no policies in place to prevent an eviction tsunami. Advocates alert that the rent crisis is threatening to spark a national catastrophe. That’s why today, we decided to analyze some incredibly shocking statistics about rental affordability in the United States that everyone should know.
While rent prices are breaking records, wage growth is currently flat. The latest numbers released by the Bureau of Labor Statistics show that weekly earnings for both men and women in the middle class were standing at $1,085 per week as of January 15. Before taxes, that’s about $4,340 of income per month, which means that middle-class households bringing in that amount would pay more than 41% of their income on rent. Official housing agencies say that anyone spending more than 30% of their income on rent is considered “cost-burdened,”. That’s to say, those workers may struggle to afford necessities such as food and transportation.
This also means that low-income workers are in extreme financial distress due to rent price increases, given that they need to spend about 55% of their income to pay for a one-bedroom rental currently listed on the market, according to estimates from the National Housing Coalition. In January, the average monthly rent affordable to a family of four with a household income at the poverty line was $694. In contrast, the average Fair Market Rent for a one-bedroom rental home was $1,492 U.S. dollars per month during that same period.
For the bottom 10%, rent prices are out of their reach in virtually all of the states in the country. The National Housing Coalition highlights that people need to earn $24.90 per hour to afford a rental home without spending more than 30% of their income. Believe it or not, there was a time when a single, full-time income could financially provide for families. But nowadays, most families are working harder than ever and still need at least two incomes to make financial ends meet.
Eviction filings have already returned to pre-pandemic levels and, in some places, even exceeded them. While illegal evictions certainly make the housing insecurity and homelessness crisis worse; the real culprit is the combination of an undersupply of affordable housing, poor wage growth, and a persistent lack of federal and state assistance to help both landlords and low-income tenants. Now, the rental affordability crisis and the growing threat of evictions in America paint a dire picture for millions of renters, putting them at risk of financial instability, and losing their homes, and also further exacerbating an already dire situation."
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