11 million Americans dedicating half of income to pay the rent

Thanks to the Federal Reserve and Janet Yellen, housing affordability is gradually becoming a major problem for millions of Americans all over the country. Due to the skyrocketing costs of renting, millions of renters spend at least half of their income toward housing.

According to a new annual State of the Nation’s Housing Report from the Joint Center for Housing Studies of Harvard University, 11 million people dedicated at least half of their earnings to pay the rent. This incredible figure is now a record high. It doesn’t end there.

Researchers note that 21.3 million people are spending one-third or more of their paycheck to pay the rent, which is also a record high. As renting costs grow faster than wages – the average renter earns about $35,000 per year – it’s becoming harder to pay the rent.

Simply put: the rent is too damn high!

Here is one excerpt from the report:

“Cost burdens are nearly universal among the nation’s lowest-income households. Federal assistance reaches only a quarter of those who qualify, leaving nearly 14 million households to find housing in the private market where low-cost units are increasingly  scarce. Low -income households  with cost burdens face higher rates of housing  instability, more often settle for poor-quality housing, and have to sacrifice other needs—including basic nutrition, and  safety—to  pay  for  their housing. These  conditions  have  serious  long -term  consequences,  particularly  for  children’s  future  achievement.  ‘And compounding these  challenges,’ added  Daniel  McCue, a  senior  research associate  at  the  Joint  Center,  ‘residential  segregation  by  income has increased. Between 2000 and  2014, the number of people living in neighborhoods of concentrated poverty more than doubled to 13.7 million.'”

Interestingly enough, renters are sitting at both ends of the income spectrum. In 2015, half of new renters earned less than $25,000, while high-income households became the biggest segment of new renters for the past three years.