Skyrocketing Rents: Are You Paying Too Much?

Skyrocketing Rents: Are You Paying Too Much?

Cringe every time you write the rent check? You’re not alone.

New data from RealtyTrac suggests one-third of Americans live in a housing market where rent for a three-bedroom home takes up at least 30% of the monthly median income, which is the standard for affordable housing.

In Philadelphia, Brooklyn, Baltimore and Miami, renters allocate about 50% of their income toward rent, CNN reports. And those living in the Bronx, N.Y. spend almost 66% of their monthly income, on average, on rent for a three-bedroom house.

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The prevalence of unaffordable housing has increased dramatically in the last few years. According to a 2013 report by the Joint Center for Housing Studies of Harvard University, the number of cost-burdened renters increased from 8.8 million in 2007 to 11.3 million in 2011. Unaffordable housing is an especially big issue among low-income renters; the JCHS found more than 70% of low-income families and individuals pay more than half their income for rent.

How did housing become such a financial burden for Americans? The JCHS cites a number of factors, including the foreclosure crisis and ongoing economic instability, which has prevented many renters from purchasing their own homes. Partly because of this growing demand for rental housing, rent has increased more than 21% since 2006.

Rising housing costs have taken a serious toll on renters’ quality of life. According to the JCHS report, low-income renters who struggle with unaffordable housing are frequently driven to spend less on food, health care and retirement.

Luckily, in many cases it’s possible to mitigate rising housing costs. Try negotiating with your landlord to lower the rent or cutting costs in other areas, such as transportation.

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