Affordable rental options becoming scarce

Despite rising demand

Vilas Bhuchar, May 16, 11.

With demand for rental housing units on the rise, renters are finding it more difficult to find affordable options and the number of renters spending 50% or more of their income on housing and utilities is at an all time high, according to a recent study conducted by Harvard University’s Joint Center for Housing Studies (JCHS) and as reported by Builder Magazine:

The study, titled “America’s Rental Housing: Meeting Challenges, Building on Opportunities”, reports that more than one in four renters, or 10.1 million Americans, faces such a burden. That number has grown by 2.6 million over the past decade. An additional 26% of renters spend between 30% and 50% of their income on rent and utilities, meaning that more than half the country’s renters face at least a moderate cost burden.

“If you are a person working a low-wage job and are spending 50% or 60% of your income on housing, you will have no room for error, no room for catastrophe, no room for savings, and certainly no ability to think about plans for retirement,” said Sheila Crowley, president and CEO at NLIHC, during a press call announcing the findings of “Out of Reach.”

And it’s not just the lowest paid workers that are being affected. “In the last decade, rental housing affordability problems went through the roof,” said Eric Belsky, managing director of the JCHS and an author of “America’s Rental Housing.” “And these affordability problems are marching up the income scale.”

Harvard’s study found that although severe housing cost burdens are more concentrated in the bottom fifth of the household income distribution, during the past 10 years, the number of renter households in the next two higher quintiles that faced a severe housing cost burden grew by one million. There were also increases among lower-middle-income and middle-income renting households paying between 30% and 50% of their income on housing and utilities. “In real terms, it means more people have less money to spend on household necessities such as food, healthcare, or savings,” Belsky said.

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