The Typical American Renter Is Now Rent-Burdened, a Report Says

Moody’s Analytics finds that renters in the U.S. now pay 30 percent of the median income for the average rent.

A bird’s-eye view of the densely packed Manhattan cityscape, with skyscrapers in the distance, silhouetted against a blue sky,
In New York City, residents now pay 68.5 percent of the median income to cover the average rent. Credit...Karsten Moran for The New York Times

The typical American renter is now rent-burdened — meaning that 30 percent of the median U.S. income is required to pay the average rent, according to a new report from Moody’s Analytics.

“This 30 percent is a symbolic threshold, a milestone,” said Thomas LaSalvia, the director of economic research at Moody’s.

Reaching this threshold puts typical American renters — who earn the median income and pay the average rent — where they have never been before, Mr. LaSalvia said. (According to the Pew Research Center, about 36 percent of American households rented, rather than owned, their homes in 2019, the last year that reliable data was available from the Census Bureau.) Moody’s first started tracking the metric in 1999, when the typical rent-to-income ratio was 22.5 percent.

The rent-to-income ratio was calculated by comparing the national median household income, $71,721, with the average monthly rent, $1,794, for 2022. The current 30 percent figure is an increase from 28.5 percent in 2021, and from 25.7 percent in 2020. In 2019, before the pandemic, renters with the median income would be spending 27.2 percent of their income on the average rent.

“The rent-to-income ratio continued to climb up because income growth was not able to catch up with the rent growth,” said Lu Chen, a senior economist at Moody’s Analytics.

The United States Department of Housing and Urban Development has defined rent-burdened families as those who spend more than 30 percent of their household income on housing and “may have difficulty affording necessities such as food, clothing, transportation, and medical care.”

“We’ve been moving in this direction for decades,” said Martha Galvez, the executive director of the Housing Solutions Lab at New York University’s Furman Center. “Since the ’70s, rents have been rising faster than incomes. And among lower-income households, high rent burdens have been the norm for a long time.”

Ms. Chen also noted that the disappearance of “Covid discounts” in many major cities contributed to the burden. “The second half of 2021 is where we saw a lot of the reverse migration happening in many places in the country, with many residents taking advantage of the Covid discounts for rents in the hottest areas, like New York, Jersey, Boston,” she said.

As renters migrated back into populous metropolitan areas, Covid restrictions were loosened and rents started to creep back up.

“The places where you saw the biggest decline in rent are now seeing the biggest increase in rents,” Ms. Chen said.

Residents in some cities are more rent burdened than others. In New York, for example, the rent-to-income ratio in 2022 was 68.5 percent, the Moody’s report found. It was followed by Miami at 41.6 percent, Fort Lauderdale at 36.7 percent and Los Angeles at 35.6 percent.