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It’s the worst time in 36 years to be a renter in America. The median rent nationwide now takes up 30.2 percent of the median American’s income, the highest cost burden recorded by Zillow since the real estate firm began tracking the figure in 1979.
In the late 1980s and throughout the 1990s, the median American looking to lease a home could expect to spend a little less than a quarter of what she earned on rent. Last year at this time, the median cost burden for renters was 29.5 percent of income. The new figure cracks the formal 30 percent threshold economists and housing experts use to define rent affordability. Because it’s calculated based on median income and median rent rather than using data about what actual renters earn and pay, the figure inevitably smooths out some of the lived experience of the rental crisis in America. But if rent is now unaffordable even for that hypothetical median renter, that suggests a problem that was once acute to certain low-income communities has now become a mainstream tenant experience.
Zillow’s newest number attempts to give a snapshot of the situation renters face nationwide. In particular pockets of America, the situation is even more dire according to separate Zillow figures from 2014. New Orleans tenants can expect to spend 35 percent of what they earn on rent, two-and-a-half times the historical average for the city. The median New York City rent gobbles up almost 40 cents of every dollar the median New Yorker earns. Los Angeles residents face a rental market where the median home will cost nearly half the median income. Even smaller communities like Ithaca, NY, and Flagstaff, AZ, were well above the 30.2 percent national median rent burden figure the firm now reports as an all-time high.
Looking at individual tenants instead of abstract estimates produces an even more startling sense of how actual Americans are faring in those markets. Census data suggest that half of all tenants nationwide are paying more than 30 percent of their actual income in rent, according to a 2013 analysis from Harvard’s Joint Center for Housing Studies. One in every four renting households spends at least 50 cents of every dollar they earn on rent, the report said. Even among renter families with household income as high as $75,000, nearly one in five are paying rents higher than the 30 percent of income that housing experts define as affordable.
In theory, it shouldn’t be possible for rents to accelerate this far while incomes stagnate. As Zillow’s newest report indicates, the monthly costs of homeownership are now roughly half the monthly cost of rent. Normally that would help cool the rental market. But while it’s been almost seven years since the financial crisis, these are still far from normal times.
I paid cash for this place. Taxes are cheap and in 5 years, I've spent $105 on a service call for the central AC and $1,200 for a new well pump.Renters don't pay property taxes or homeowner's insurance. They often are not taxed with even mowing the yard.
They don't have to worry about leaking roofs, busted gutters, cracked foundations, stopped-up plumbing, trees ready to fall on their home.... blah blah blah.
I have $90K left on my 2.65% mortgage and believe me I wish I was renting.
I paid cash for this place. Taxes are cheap and in 5 years, I've spent $105 on a service call for the central AC and $1,200 for a new well pump.Renters don't pay property taxes or homeowner's insurance. They often are not taxed with even mowing the yard.
They don't have to worry about leaking roofs, busted gutters, cracked foundations, stopped-up plumbing, trees ready to fall on their home.... blah blah blah.
I have $90K left on my 2.65% mortgage and believe me I wish I was renting.
I could have been paying $1,000/month for the last 5 years and be out 60 grand with nothing to show for it.
Rents reflect costs associated with owning property Take my son's 2 family house in Connecticut. He has a $900/month mortgage $250/month insurance payment and $450/month property taxes.
That's $1600/month, not including maintenance; figure another $200/month.
So it costs him $1,800/ month and he occupies the 2nd floor apartment. What should he charge for the first floor 2 bedroom 1 bath 1,600 square foot flat?
Going rate is $900- $1,000/month, which is about half of the cost of ownership and seems fair to me.
If 30% is all a tenant should pay for rent, he would have to make about $3,335/month to rent there.
So do I, but we don't live in Connecticut.Rents reflect costs associated with owning property Take my son's 2 family house in Connecticut. He has a $900/month mortgage $250/month insurance payment and $450/month property taxes.
That's $1600/month, not including maintenance; figure another $200/month.
So it costs him $1,800/ month and he occupies the 2nd floor apartment. What should he charge for the first floor 2 bedroom 1 bath 1,600 square foot flat?
Going rate is $900- $1,000/month, which is about half of the cost of ownership and seems fair to me.
If 30% is all a tenant should pay for rent, he would have to make about $3,335/month to rent there.
$450 a month property tax??? I pay less than that for a years worth of property tax.
You're trying to assume these people paying rent can get there own home or afford it..Renters don't pay property taxes or homeowner's insurance. They often are not taxed with even mowing the yard.
They don't have to worry about leaking roofs, busted gutters, cracked foundations, stopped-up plumbing, trees ready to fall on their home.... blah blah blah.
I have $90K left on my 2.65% mortgage and believe me I wish I was renting.
You're trying to assume these people paying rent can get there own home or afford it..Renters don't pay property taxes or homeowner's insurance. They often are not taxed with even mowing the yard.
They don't have to worry about leaking roofs, busted gutters, cracked foundations, stopped-up plumbing, trees ready to fall on their home.... blah blah blah.
I have $90K left on my 2.65% mortgage and believe me I wish I was renting.
Rents reflect costs associated with owning property Take my son's 2 family house in Connecticut. He has a $900/month mortgage $250/month insurance payment and $450/month property taxes.
That's $1600/month, not including maintenance; figure another $200/month.
So it costs him $1,800/ month and he occupies the 2nd floor apartment. What should he charge for the first floor 2 bedroom 1 bath 1,600 square foot flat?
Going rate is $900- $1,000/month, which is about half of the cost of ownership and seems fair to me.
If 30% is all a tenant should pay for rent, he would have to make about $3,335/month to rent there.
$450 a month property tax??? I pay less than that for a years worth of property tax.
The left?If the left hadn't screwed the economy to begin with, we wouldn't be here.
It only crashed while Bush was in office. The bubble was caused by the CRA, started by Carter and expanded by clinton.The left?If the left hadn't screwed the economy to begin with, we wouldn't be here.
Who exactly was the President of the United States of America from jan-2001 to jan-2009 ?
Who was holding office when the mortgage bubble busted?
A leftist you say ?
Have the balls to call the man by his name : if George W Bush hadn't screwed the economy to begin with, we wouldn't be here.
It only crashed while Bush was in office. The bubble was caused by the CRA, started by Carter and expanded by clinton.The left?If the left hadn't screwed the economy to begin with, we wouldn't be here.
Who exactly was the President of the United States of America from jan-2001 to jan-2009 ?
Who was holding office when the mortgage bubble busted?
A leftist you say ?
Have the balls to call the man by his name : if George W Bush hadn't screwed the economy to begin with, we wouldn't be here.
Many Conservatives foretold the collapse, but Barney Frank assured the terminally stupid Progressives that everything was just hunky dory.
You're right. It's a shame that Barney Frank didn't see the same danger there that John McCain did.It only crashed while Bush was in office. The bubble was caused by the CRA, started by Carter and expanded by clinton.The left?If the left hadn't screwed the economy to begin with, we wouldn't be here.
Who exactly was the President of the United States of America from jan-2001 to jan-2009 ?
Who was holding office when the mortgage bubble busted?
A leftist you say ?
Have the balls to call the man by his name : if George W Bush hadn't screwed the economy to begin with, we wouldn't be here.
Many Conservatives foretold the collapse, but Barney Frank assured the terminally stupid Progressives that everything was just hunky dory.
Just to be clear : during Dubya's period the subprime mortgages skyrocketed from 173 b to 640 b.
While Bill Clinton took them from 34 to 173 billion.
To be fair Dubya is only responsible for 73% of the crisis.
Real Estate Bubbles
This is a problem we need to address...
Americans Already Spent A Shocking Amount On Rent, But It Just Got Worse
It’s the worst time in 36 years to be a renter in America. The median rent nationwide now takes up 30.2 percent of the median American’s income, the highest cost burden recorded by Zillow since the real estate firm began tracking the figure in 1979.
In the late 1980s and throughout the 1990s, the median American looking to lease a home could expect to spend a little less than a quarter of what she earned on rent. Last year at this time, the median cost burden for renters was 29.5 percent of income. The new figure cracks the formal 30 percent threshold economists and housing experts use to define rent affordability. Because it’s calculated based on median income and median rent rather than using data about what actual renters earn and pay, the figure inevitably smooths out some of the lived experience of the rental crisis in America. But if rent is now unaffordable even for that hypothetical median renter, that suggests a problem that was once acute to certain low-income communities has now become a mainstream tenant experience.
Zillow’s newest number attempts to give a snapshot of the situation renters face nationwide. In particular pockets of America, the situation is even more dire according to separate Zillow figures from 2014. New Orleans tenants can expect to spend 35 percent of what they earn on rent, two-and-a-half times the historical average for the city. The median New York City rent gobbles up almost 40 cents of every dollar the median New Yorker earns. Los Angeles residents face a rental market where the median home will cost nearly half the median income. Even smaller communities like Ithaca, NY, and Flagstaff, AZ, were well above the 30.2 percent national median rent burden figure the firm now reports as an all-time high.
Looking at individual tenants instead of abstract estimates produces an even more startling sense of how actual Americans are faring in those markets. Census data suggest that half of all tenants nationwide are paying more than 30 percent of their actual income in rent, according to a 2013 analysis from Harvard’s Joint Center for Housing Studies. One in every four renting households spends at least 50 cents of every dollar they earn on rent, the report said. Even among renter families with household income as high as $75,000, nearly one in five are paying rents higher than the 30 percent of income that housing experts define as affordable.
In theory, it shouldn’t be possible for rents to accelerate this far while incomes stagnate. As Zillow’s newest report indicates, the monthly costs of homeownership are now roughly half the monthly cost of rent. Normally that would help cool the rental market. But while it’s been almost seven years since the financial crisis, these are still far from normal times.
Renters don't pay property taxes or homeowner's insurance. They often are not taxed with even mowing the yard.
They don't have to worry about leaking roofs, busted gutters, cracked foundations, stopped-up plumbing, trees ready to fall on their home.... blah blah blah.
I have $90K left on my 2.65% mortgage and believe me I wish I was renting.
