A new report by Zillow paints a stark picture of America’s rental affordability crisis, revealing that renters in eight major U.S. cities now need to earn six-figure salaries just to comfortably afford housing – double the number of cities from five years ago.
Nationwide, the annual income required to afford a typical rental has surged to more than $80,000, up from $60,000 in 2020. The increase reflects a 28.7% spike in apartment rents and a staggering 42.9% jump in single-family home rents over that same period. In contrast, the median U.S. household income has only risen by 22.5%, now sitting at approximately $82,000 — widening the affordability gap for millions of renters.
“Housing costs have surged since pre-pandemic, with rents growing quite a bit faster than wages,” said Orphe Divounguy, senior economist at Zillow. “This often leaves little room for other expenses, making it particularly difficult for those hoping to save for a down payment on a future home.”
Renters earning the national median income are now spending just under the critical affordability threshold of 30% of income on housing, with 29.6% going toward rent. But in eight expensive metro areas — San Jose, New York, Boston, San Diego, San Francisco, Los Angeles, Miami, and Riverside, CA – renters need to earn over $100,000 annually to stay below that threshold.
In most of these cities, even the median household would be considered rent-burdened. Only San Jose (25%) and San Francisco (28%) remain technically affordable for local earners, as incomes there have kept better pace with rising rents.
Despite national trends, several U.S. cities remain relatively affordable. Renters in Buffalo, NY; Oklahoma City, OK; and Louisville, KY need incomes between $55,000 and $57,000 to afford typical rentals – spending no more than 23% of their income on housing.
Affordability issues are not limited to monthly rent. In high-cost metros like New York and Boston, renters often face significant upfront costs, including broker fees and advance payments. However, recent legislative moves like New York City’s newly passed FARE Act and pending bills in New York and Massachusetts could offer some relief by targeting these hidden expenses.
As affordability challenges mount, Zillow’s findings underscore a growing urgency for both renters and policymakers to address the nation’s evolving housing landscape.
