Survey Finds that Over 20% of Renters Use Entire Paycheck to Cover Rent

November 22, 2024 TruthUSA

13 percent of U.S. renters have reported tapping into their retirement funds to cover rent expenses.

More than 22 percent of U.S. renters use their entire regular income to pay for rent, a recent survey commissioned by real estate brokerage firm Redfin revealed.

The survey conducted in September by Ipsos among 1,802 U.S. residents aged 18 to 65 found that 19 percent of renters work jobs they dislike to afford rent, while 20 percent have taken on second jobs to cover housing costs.

14 percent of renters rely on cash gifts from family to pay rent, with 13 percent withdrawing money from retirement funds early for housing expenses. Additionally, 12 percent have reduced contributions to their retirement savings to prioritize immediate financial needs over long-term security.

Other strategies employed to afford rent include receiving government assistance (18 percent), living with relatives or friends to save money (14 percent), nonprofit assistance (7 percent), selling stock investments (7 percent), utilizing inheritance (5 percent), and selling cryptocurrency investments (5 percent).

Redfin’s study last month noted that fewer than one-third (32.1 percent) of renters pay under $1,000 in monthly rent, the lowest on record. This figure has decreased from 35.2 percent in 2022 and 50.4 percent in 2012.

According to separate studies by the brokerage firm in recent months, U.S. rents have stabilized over the past year, though they remain significantly higher than pre-COVID-19 pandemic levels.

Rental prices have outpaced wage growth, posing challenges to many Americans, especially those with lower incomes, in affording housing.

Redfin Senior Economist Sheharyar Bokhari mentioned, “Rents are stable nationwide but can vary significantly depending on your location. The East Coast and Midwest have seen less construction activity, leading to rising rents. Conversely, in Sun Belt cities where construction surged post-pandemic, rents are declining rapidly.”

In an October analysis, Redfin found that the median U.S. asking rent increased by 0.6 percent year over year in September to $1,634 but decreased by 0.2 percent month over month.

Cities like Washington and Cleveland experienced significant rent hikes, while Jacksonville saw a notable decrease. Despite the challenges, renting remains popular due to affordability issues in the home-buying market.

The analysis also highlighted that the number of renter households is growing three times faster than homeowner households, mainly because buying costs have risen faster than renting expenses.

Redfin suggested that rental affordability could improve with the introduction of more newly constructed apartments into the market.

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