– Average US rent just below $2,000 in April
– Prospective tenants need to earn $79,889 to spend only 30% of income on rent
– Rent growth has outpaced wage growth, making homeownership more difficult for many
Rents in the US have continued to rise, reaching just below $2,000 on average in April. According to a Zillow report, to afford this rent while spending no more than 30% of their income, prospective tenants now need to earn around $79,889 annually, which is a 36% increase from 2019. Wages have not been able to keep pace with rent growth, which has appreciated 1.5 times faster than income over the past five years.
Despite some slight improvements in the rental market due to strong multifamily construction, rents continue to increase across most cities. While Oklahoma City was the only metro area to see rents fall in April, supply is still limited and half of tenants were previously spending over 30% of their income on rent. National rent growth last year was overshadowed by wage growth for the first time in a while.
The surge in rental pricing has made homeownership difficult for many, with renting expected to remain much cheaper than buying for the foreseeable future. Homebuyers are also facing challenges in a market with low inventory, high mortgage rates, and rising insurance costs. In fact, the median US monthly housing payment has reached a record high of $2,894 as of early May.