Redfin: Fewer Than Half of Renters Make Enough for Median-Priced Apartment

(Image courtesy of Redfin)

Redfin, Seattle, released a new report finding that just 39% of renters make enough to afford the median-priced apartment nationwide.

The typical U.S. renter household earns an estimated $54,712 a year, but the estimated income a renter needs to afford rent for the median-priced U.S. apartment is $66,120 a year.

Redfin defines an apartment as “affordable” if the renter spends a maximum of 30% of their income on rent–another popular phrasing is that a renter’s annual income is at least 40 times their monthly rent.

The amount to afford a median-priced apartment is at the highest level since October 2022. It’s up 0.8% year-over-year and up 22.9% since May 2019.

The income needed to afford a median apartment fell to as low as $63,920 in December 2023, but that was still out of reach for many renters.

“Rents are growing at a snail’s pace compared to the rapid increases we saw during the pandemic, and are unlikely to soar again anytime soon. As a result, wage growth should continue to outpace rent growth in the coming months, as it has been doing since 2022,” said Redfin Senior Economist Sheharyar Bokhari. “That will help narrow the affordability gap for renters, but for a lot of folks, the math still won’t check out. Many U.S. renters are and will remain burdened by the cost of having a roof over their head, and unlike homeowners, they’re not building wealth through rising property values.”