'Money Is So Tight That We Will All Go Out As A Family And Do DoorDash Together' — Half Of All Renters Are Spending More Than 30% Of Their Income On Housing

According to a 2024 report by Harvard’s Joint Center for Housing Studies, rental prices in the United States have escalated to an unprecedented level of unaffordability for a significant number of Americans. Half of all renters are now allocating more than 30% of their income toward rent and utilities. This analysis, leveraging 2022 census data, reveals the intensifying financial strain on individuals and families across the nation.

Renters from various states came forward to share their narratives with PBS, highlighting the profound impact of soaring rental prices on their daily lives. 

“I am probably paying about two-thirds of my income, my monthly income, in rent,” Kathleen Haun from Georgia said.

In a similar vein, Duane Pesice from Arizona said, “My rent is about 75% of my income,” illustrating the severe financial sacrifices many are making to secure housing.

The gravity of the situation is underscored by Teisha Ford from Idaho, who shared a particularly poignant aspect of her family’s struggle: “There are times when money is so tight that we will all go out as a family and do DoorDash together. So it’s embarrassing. It’s not fun, especially since I have a professional job and things like that. I have an MBA.” This reflection speaks to the economic challenges renters face and the emotional and psychological toll it takes on families.

More on the rental market: Investing in real estate just got a whole lot simpler. This Jeff Bezos-backed startup will allow you to become a landlord in just 10 minutes, and you only need $100.

Jade Gielecki from South Carolina estimated that she spends about “60% of my monthly income on rent and utilities,” while Dennis Layden from Florida pointed out the broader consequences of such financial strain: “When your rent is taking up a third or more of your budget, the first thing that you have to get rid of is your entertainment budget. You have to get rid of things that give us, I guess, relief.”

The severity of the affordability crisis is illustrated by renters’ drastic measures to cope with high costs. Ford also said, “In order to make up for the additional cost of rent, we do have to every once in a while go to food pantries to even subsidize our grocery budget, which is abysmal at this point.” 

Gielecki shared a particularly striking living arrangement. “In my current situation, I actually live with a couple who is no longer a couple anymore. But we cannot afford to live elsewhere,” she said.

Start generating passive income through real estate

Check out these featured investments from Benzinga's Real Estate Offerings Screener.

Whitney Airgood-Obrycki, the report’s lead author, explained the findings, indicating a record-high number of cost-burdened renters in 2022. This trend has been fueled by high rent growth, a surge in rental demand and a lack of sufficient housing supply, leading to low vacancy rates and rising rents.

The study found that the affordability crisis affects all income levels, with significant increases among middle-income renter households. Airgood-Obrycki underscored the dire circumstances for lower-income households, where “an additional 2 million households” experienced increased cost burdens from 2019 to 2022. The consequence of such financial pressure includes sacrifices in food, healthcare and essentials, leading to a record-high number of Americans experiencing homelessness.

Despite a recent deceleration in rental price growth, the affordability issue remains a critical concern. The pandemic-induced rent hikes have left many renters in precarious financial situations. Airgood-Obrycki emphasizes the need for a comprehensive approach to address the affordability crisis, including increased housing supply, zoning reforms and expanded subsidies, to mitigate the challenges renters face and address the rising homelessness issue.

For those affected by the rental market’s current state, investing on platforms like Arrived could serve as a strategic move to leverage the real estate market’s potential benefits. It represents a shift toward making real estate investment more accessible and manageable, offering a potential pathway to building wealth in a challenging housing market.

Read Next:

• Warren Buffett once said, "If you don't find a way to make money while you sleep, you will work until you die." Here are 3 high-yield investments to add significant income to your portfolio.
• Ken Griffin says Miami will take New York's place as the U.S. Financial Capital. Here's how you can invest in the city with as little as $500 before that happens.