Down Angle Symbol A symbol in the form of an angle pointing downwards. A “For Rent” sign for a townhouse on Capitol Hill's northeast side is pictured in Washington DC on Monday, August 26, 2019, Tom Williams/Getty Images
- Cheap rents are becoming increasingly difficult to find as housing costs have risen sharply over the last decade.
- The number of homes renting for less than $1,000 has plummeted, Harvard researchers found.
- Half of renters now spend more than 30% of their income on housing.
If you're having trouble finding a cheap rental apartment, you're not alone: low-rent apartments are harder than ever to find.
According to a new report from the Joint Center for Housing Studies at Harvard, the supply of homes renting for less than $1,000 a month has dried up over the past decade, while the supply of homes renting for $1,000 or more to be rented is larger.
The number of homes renting for less than $600, adjusted for inflation, fell from about 9.4 million units in 2012 to 7.2 million in 2022, according to Harvard researchers' analysis of 2022 census data. And homes with rents between $600 and $799 fell from nearly 9 million to 5.8 million units. Meanwhile, the number of homes renting for at least $2,000 a month more than doubled, rising from about 3.2 million to 7.3 million homes.
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This is just further evidence of the housing affordability crisis facing many cities and towns across the country. Millions of Americans can't afford their rent and are struggling to own a home.
Even many renters and homeowners who can afford their housing costs find themselves unable to move due to stubbornly high mortgage rates and market rents. Fortunately, rent growth is expected to slow this year as developers struggle to bring significant numbers of new multifamily properties into production. Still, the outlook for affordability is bleak.
The main reason for the sharp rise in housing costs in recent years is a serious housing shortage of 3.8 to 6.5 million units. The rise in remote work since the pandemic has also helped drive demand for — and the cost of — housing in many parts of the country. In recent years, property prices have risen at a record pace.
The Harvard study found that half of American renters spend more than 30% of their income on rent and utilities, making their housing unaffordable by a widely used measure of affordability. Of the record 22.4 million rent-burdened households, 12.1 million spend more than half of their income on housing costs. Homelessness is also at a record high.
Middle-income renters – those earning between $30,000 and $74,999 per year – saw the most dramatic increases in housing costs between 2019 and 2022. In California, where younger workers have seen drastic declines in homeownership rates in recent decades, the number of housing units priced at $2,000 and up has more than doubled.
These rent increases come as more Americans believe they will never own a home: According to the New York Federal Reserve's February 2023 Housing Survey, only 41% of renters believe there is a chance they will own a primary residence in the future . However, the majority of renters say they would prefer or even prefer to own rather than rent.