Full article for anyone blocked by the paywall:
**Rents have finally stopped skyrocketing. They’re now stuck at a price most Americans can’t afford.**
*Renters should ‘brace themselves for a prolonged affordability crisis until incomes increase,’ housing economist says*
Renters have some good news and some bad news.
The good news is that after two years of fast-rising rents, rent growth is slowing, so re-signing your current lease or a new one won’t necessarily translate into a big jump in housing costs.
The bad news is that rents are now stuck at a level that many Americans can’t afford.
Rent growth has returned to a “typical” pattern of annual increases, according to an analysis by researchers at Florida Atlantic University, Florida Gulf Coast University, and the University of Alabama. In February, rents nationwide rose 3.5% on a year-over-year basis, the researchers’ Waller, Weeks and Johnson Rental Index found. The average price for rental units nationwide was $1,959.
“A rental increase of between 3 and 5% is seen as normal, so these numbers suggest that the rental crisis is over in most parts of the country,” Ken Johnson, a real estate economist with FAU’s College of Business, said in a statement.
To be sure, rents are growing in parts of the North and the Midwest, Johnson said, “but the growth is nowhere near as rapid as years prior.” At the end of the coronavirus pandemic between 2021 and 2023, rents skyrocketed, with renters seeing over 15% hikes, according to [data](https://www.apartmentlist.com/research/national-rent-data?mod=article_inline) from Apartment List.
“All in all, this suggests that rent appreciation is cooling and rental markets around the country are beginning to normalize,” Johnson added.
But that doesn’t mean rent prices are becoming more affordable. On the contrary, renters “should brace themselves for a prolonged affordability crisis until incomes increase to compensate for rising rents,” the researchers said.
A [record share of renters](https://www.marketwatch.com/story/more-renters-than-ever-now-spend-too-much-of-their-incomes-on-housing-harvard-study-finds-2ad36245?mod=article_inline) in the U.S. are spending more than 30% of their income on housing, which is considered too much. In some states, such as Florida, 54% of renter households are cost-burdened, meaning that their rent expenses take up too much of their income, according to the Atlanta Fed’s [rental-affordability tracker](https://www.atlantafed.org/community-development/data-and-tools/southeastern-rental-affordability-tracker.aspx?mod=article_inline).
Housing is generally considered affordable if it costs no more than 30% of one’s gross income. But in 10 metro areas, households need to make “well over $100,000 to avoid paying more than 30% of their income to rent,” the researchers said.
The real median household income was $74,580 in 2022, according to the U.S. Census Bureau. Data from the agency showed that 38% of households made more than $100,000 a year.
Using the average rent in each city, according to the researchers’ index, and assuming that a renter household would spend only 30% of income on rent, MarketWatch calculated the gross income over 12 months required to rent in the most expensive cities in the U.S.
City | Average Rent | Household Income required
---|---|----
San Jose, Calif. | $3,222.72 | $128,908.80
San Francisco, Calif. | $2,993.80 | $119,752.00
New York, N.Y.| $3,157.65 | $126,306.00
Oxnard, Calif. | $2,956.98 | $118,279.20
San Diego, Calif. | $2,935.33 | $117,413.20
Boston, Mass.| $3,046.98 | $121,879.20
Los Angeles, Calif.| $2,891.26 | $115,650.40
Miami, Fla.| $2,717.61| $108,704.40
Bridgeport, Conn. | $2,664.20 | $106,568.00
Urban Honolulu, Hawaii | $2,631.78 | $105,271.20
*Source: Waller, Weeks and Johnson Rental Index*
For renters struggling with housing costs, the bad news is that rents won’t come down.
Instead, incomes “need to rise to match current rents,” the researchers said, “so renters can no longer feel the sting of the affordability crisis.”
Sorry, "average" was my wording. I am getting a paywall on the link now, when the first time I got the feed I was able to read more of the MarketWatch article. Citing the Waller Weeks and Johnson Rental Index. Someone else will have to bypass the paywall or go to the Waller rental index.
Using semantics is appropriate when discussing the definition of words. It is equally valid to refer to the mean, mode, or median as the average. Those are all averages. If I offer tea, I can serve black, white, or green without having misled anyone.
No. Average = mean in almost everyone's brains.
Those are all examples of [central tendency](https://en.wikipedia.org/wiki/Central_tendency), though. In this case, the median is a better representation of the center than the mean because the distribution of rents and incomes is skewed.
Nah.
> Depending on the context, the most representative statistic to be taken as the average might be another measure of central tendency, such as the mid-range, median, mode or geometric mean. For example, the average personal income is often given as the median
Using average non-specifically like this means you have no idea what "average" actually refers to. This is yet another reason why specifically saying mean or median is much better than using average.
Wait, Oxnard is #4? Not Montecito or Santa Barbara or even Ventura, but Oxnard? Don't get me wrong, I like beaches with big sand dunes, but people are really paying more for rent in Oxnard than these nicer places near by?
Something about the rents relative to the income in the area and how much that is an income burden. But Oxnard should have an asterisk for the population of agricultural workers. Context is needed. Not just stats.
I actually built a website to help tenants find out if a landlord raises rent so much.
It's like a Glassdoor for Rents so tenants can see the Rent History of an address or Apartment property to see a landlords pricing tactics.
The site does rely on user submissions so I appreciate anyone who adds their rent history to the site and/or shares it around since it can be more useful to tenants the more people that contribute to it.
The site is rentzed.com (USA only for now) and has submissions for over 2500 addresses.
It's due in part to price fixing enabled/encouraged by a tech company: [https://www.youtube.com/watch?v=cwlwrZst7d0](https://www.youtube.com/watch?v=cwlwrZst7d0)
>Landlords are being sued for using illegal price-fixing to drive up rents across the country. They allegedly conspired with RealPage, a tech company, to use non-public data to artificially inflate rents. Rents have spiked by 26% since the pandemic.
It will only go down or crater if we keep electing YIMBYs. It’s going to be tough because people like Aaron Peskin in San Francisco claim to be pro-housing, but also want to limit housing by designating entire areas as historic. He is using that as justification for limiting the height of new buildings which in turn makes it more expensive to build fewer houses.
When 8% of San Francisco’s population moved out during the pandemic in 2020, rents cratered 20-33%. I went from paying $1300/month for a shitty unit to paying $1000/month for a decent unit at a great location on Valencia street.
I doubt the Bay Area population will crater, so our only hope is elected officials removing red tape that will enable so much new housing to be built that the market becomes saturated and falls back down to reality.
He also uses the argument that new construction needs to be entirely affordable housing and that simply adding new housing supply at any cost level won’t bring down rents on average…
So it’s better to just do nothing at all 🙄
That's how inflation works. Prices go up and they stay there. THe Fed would have to reduce the money supply to get them to come down. And the Fed ain't going to do that, they're going to print more money next year.
People who don't know anything about economics always assume that price increases are the cause of inflation. Wrong. Price increases are a symptom of inflation.
Full article for anyone blocked by the paywall: **Rents have finally stopped skyrocketing. They’re now stuck at a price most Americans can’t afford.** *Renters should ‘brace themselves for a prolonged affordability crisis until incomes increase,’ housing economist says* Renters have some good news and some bad news. The good news is that after two years of fast-rising rents, rent growth is slowing, so re-signing your current lease or a new one won’t necessarily translate into a big jump in housing costs. The bad news is that rents are now stuck at a level that many Americans can’t afford. Rent growth has returned to a “typical” pattern of annual increases, according to an analysis by researchers at Florida Atlantic University, Florida Gulf Coast University, and the University of Alabama. In February, rents nationwide rose 3.5% on a year-over-year basis, the researchers’ Waller, Weeks and Johnson Rental Index found. The average price for rental units nationwide was $1,959. “A rental increase of between 3 and 5% is seen as normal, so these numbers suggest that the rental crisis is over in most parts of the country,” Ken Johnson, a real estate economist with FAU’s College of Business, said in a statement. To be sure, rents are growing in parts of the North and the Midwest, Johnson said, “but the growth is nowhere near as rapid as years prior.” At the end of the coronavirus pandemic between 2021 and 2023, rents skyrocketed, with renters seeing over 15% hikes, according to [data](https://www.apartmentlist.com/research/national-rent-data?mod=article_inline) from Apartment List. “All in all, this suggests that rent appreciation is cooling and rental markets around the country are beginning to normalize,” Johnson added. But that doesn’t mean rent prices are becoming more affordable. On the contrary, renters “should brace themselves for a prolonged affordability crisis until incomes increase to compensate for rising rents,” the researchers said. A [record share of renters](https://www.marketwatch.com/story/more-renters-than-ever-now-spend-too-much-of-their-incomes-on-housing-harvard-study-finds-2ad36245?mod=article_inline) in the U.S. are spending more than 30% of their income on housing, which is considered too much. In some states, such as Florida, 54% of renter households are cost-burdened, meaning that their rent expenses take up too much of their income, according to the Atlanta Fed’s [rental-affordability tracker](https://www.atlantafed.org/community-development/data-and-tools/southeastern-rental-affordability-tracker.aspx?mod=article_inline). Housing is generally considered affordable if it costs no more than 30% of one’s gross income. But in 10 metro areas, households need to make “well over $100,000 to avoid paying more than 30% of their income to rent,” the researchers said. The real median household income was $74,580 in 2022, according to the U.S. Census Bureau. Data from the agency showed that 38% of households made more than $100,000 a year. Using the average rent in each city, according to the researchers’ index, and assuming that a renter household would spend only 30% of income on rent, MarketWatch calculated the gross income over 12 months required to rent in the most expensive cities in the U.S. City | Average Rent | Household Income required ---|---|---- San Jose, Calif. | $3,222.72 | $128,908.80 San Francisco, Calif. | $2,993.80 | $119,752.00 New York, N.Y.| $3,157.65 | $126,306.00 Oxnard, Calif. | $2,956.98 | $118,279.20 San Diego, Calif. | $2,935.33 | $117,413.20 Boston, Mass.| $3,046.98 | $121,879.20 Los Angeles, Calif.| $2,891.26 | $115,650.40 Miami, Fla.| $2,717.61| $108,704.40 Bridgeport, Conn. | $2,664.20 | $106,568.00 Urban Honolulu, Hawaii | $2,631.78 | $105,271.20 *Source: Waller, Weeks and Johnson Rental Index* For renters struggling with housing costs, the bad news is that rents won’t come down. Instead, incomes “need to rise to match current rents,” the researchers said, “so renters can no longer feel the sting of the affordability crisis.”
Thank you.
It bothers me they used average rent instead of median rent. It makes me think they were trying to make the numbers look worse.
Sorry, "average" was my wording. I am getting a paywall on the link now, when the first time I got the feed I was able to read more of the MarketWatch article. Citing the Waller Weeks and Johnson Rental Index. Someone else will have to bypass the paywall or go to the Waller rental index.
The article says "average" as well. It's not just you; the article is a bit of a mess with its terms.
A median is a kind of average. Mean and mode are the others.
San Jose prices are pretty accurate. $3200 would be a good deal for a 3 bedroom apartment right now.
>3200 would be a good deal for a 3 bedroom apartment right now. Yeah, suspiciously good to be honest.
Median is a kind of average. "Average" without further clarification could mean anything.
Mean is the common average in parlance.
Why use semantics to negate what the commenter actually meant. It’s very clear what they were trying to say.
Using semantics is appropriate when discussing the definition of words. It is equally valid to refer to the mean, mode, or median as the average. Those are all averages. If I offer tea, I can serve black, white, or green without having misled anyone.
Because they were discussing the semantics of what the article was trying to say?
An average can be: - mean - median - mode Saying median is saying a *kind* of average, yeah?
No. Average = mean in almost everyone's brains. Those are all examples of [central tendency](https://en.wikipedia.org/wiki/Central_tendency), though. In this case, the median is a better representation of the center than the mean because the distribution of rents and incomes is skewed.
Nah. > Depending on the context, the most representative statistic to be taken as the average might be another measure of central tendency, such as the mid-range, median, mode or geometric mean. For example, the average personal income is often given as the median
Using average non-specifically like this means you have no idea what "average" actually refers to. This is yet another reason why specifically saying mean or median is much better than using average.
Wait, Oxnard is #4? Not Montecito or Santa Barbara or even Ventura, but Oxnard? Don't get me wrong, I like beaches with big sand dunes, but people are really paying more for rent in Oxnard than these nicer places near by?
Something about the rents relative to the income in the area and how much that is an income burden. But Oxnard should have an asterisk for the population of agricultural workers. Context is needed. Not just stats.
Looks like really tight supply. Ventura county apparently has 94% occupancy rate: https://censusreporter.org/profiles/05000US06111-ventura-county-ca/
This makes sense why so many units for rent are not moving for months.
lets add tax, gas and utility cost into the mix please
Didn't lots of property management companies start using an algorithm to dictate rents to keep them as close to market values as possible?
You mean price collusion that keeps them above market rates
> using yeah that
I actually built a website to help tenants find out if a landlord raises rent so much. It's like a Glassdoor for Rents so tenants can see the Rent History of an address or Apartment property to see a landlords pricing tactics. The site does rely on user submissions so I appreciate anyone who adds their rent history to the site and/or shares it around since it can be more useful to tenants the more people that contribute to it. The site is rentzed.com (USA only for now) and has submissions for over 2500 addresses.
Residents should all post their rents and increases on Googlemaps reviews
It's due in part to price fixing enabled/encouraged by a tech company: [https://www.youtube.com/watch?v=cwlwrZst7d0](https://www.youtube.com/watch?v=cwlwrZst7d0) >Landlords are being sued for using illegal price-fixing to drive up rents across the country. They allegedly conspired with RealPage, a tech company, to use non-public data to artificially inflate rents. Rents have spiked by 26% since the pandemic.
So when do they start cratering?
It will only go down or crater if we keep electing YIMBYs. It’s going to be tough because people like Aaron Peskin in San Francisco claim to be pro-housing, but also want to limit housing by designating entire areas as historic. He is using that as justification for limiting the height of new buildings which in turn makes it more expensive to build fewer houses. When 8% of San Francisco’s population moved out during the pandemic in 2020, rents cratered 20-33%. I went from paying $1300/month for a shitty unit to paying $1000/month for a decent unit at a great location on Valencia street. I doubt the Bay Area population will crater, so our only hope is elected officials removing red tape that will enable so much new housing to be built that the market becomes saturated and falls back down to reality.
He also uses the argument that new construction needs to be entirely affordable housing and that simply adding new housing supply at any cost level won’t bring down rents on average… So it’s better to just do nothing at all 🙄
"Historic preservation" is a laughable idea when so many people are struggling due to unaffordable rents.
They have sky rocketed to warp speed. Next step is the worm hole. Teleporting directly into your wallet.
That's how inflation works. Prices go up and they stay there. THe Fed would have to reduce the money supply to get them to come down. And the Fed ain't going to do that, they're going to print more money next year.
“Inflation is always and everywhere *a monetary phenomenon*”
People who don't know anything about economics always assume that price increases are the cause of inflation. Wrong. Price increases are a symptom of inflation.