An American making an average wage needs to work about 63 hours before earning enough to pay the typical monthly U.S. rent of $2,040. That is three hours more than they would have needed to work a year ago, and six hours more than before the pandemic in October 2019, a new Zillow analysis finds1.
These figures illustrate the growing affordability hurdles renters face, even amid what has been a strong labor market. The average hourly wage has grown 23% over the past five years, but rents are up 36.9% over the same period, according to a news release.
“The rental market has cooled this year, but so far that has meant prices growing more slowly, not any real relief for renters,” said Jeff Tucker, senior economist at Zillow in the release. “Rents were growing at a record pace for much of 2021, squeezing budgets for renters moving or renewing leases. Now, it appears more people are opting to double up with roommates or family, which means more vacancies and pressure on landlords to price their units competitively, offering some hope of relief on the horizon. Rents fell last month for the first time in two years, possibly the start of more price drops, or at least a signal that we are back to the usual seasonal rhythms of the rental market.”
Two-Tear Streaks Ends
The typical U.S. rent finally ended a two-year streak of nonstop growth in October, falling 0.1% month over month to $2,040. Annual rent growth peaked at a record 17.1% in February and has since slowed to 9.6% year-over-year growth.
Renters in Miami face the greatest affordability hurdles, needing to work 96 hours at the average wage to pay the typical rent. That is 24 hours more than Miami renters would have been required to work to pay rent five years ago, the biggest gap among the 50 largest U.S. metro areas.
Other Sun Belt markets — the hottest housing region during the pandemic — have seen similarly large jumps in hours of work needed to pay rent. An average worker in Tampa would need to work an additional 20 hours to pay rent compared to five years ago. Phoenix rents are up 66.7% since 2017, the most in the country among large markets, and renters need to work 17 hours more to pay rent.
Steep Rent Hikes
Even after steep rent hikes, hours of work needed to afford rent remain below the national average of 63 hours in several Sun Belt markets. This includes Atlanta (61 hours), Phoenix (61 hours), Nashville (60 hours), and Austin (58 hours), among others. While longtime residents will see a much different picture than they may have been used to, these markets still offer relative affordability and are likely to continue to attract residents from more expensive areas of the country.
Rents have gotten easier to pay over the past five years in only three large metros, and they are among the most expensive in the country: San Jose, Boston, and San Francisco. Rents have grown more slowly than average in these markets, helping wages catch up just a bit. Even after the slight drop since 2017, the average person would need to work more hours to pay rent than the national average in each of these markets.
Search Process Nightmares
In addition to affordability challenges, Zillow’s research has revealed that the search process has caused 40% of renters to lose sleep. Strategies such as being flexible about move-in dates and being one of the first applicants have helped recent renters find a place to live. Zillow has tools designed to help renters search confidently in their area, including a rent affordability calculator, rental market trends tool, and a move-in date filter.
Metro Area* | Hours of | Typical Rent | Five-Year | Five-Year | Five-Year Change |
United States | 62.6 | $2,040 | 36.9 % | 23.0 % | 6.3 |
New York, NY | 87.0 | $3,212 | 23.3 % | 18.1 % | 3.5 |
Los Angeles, CA | 80.6 | $2,979 | 32.9 % | 28.6 % | 1.7 |
Chicago, IL | 55.4 | $1,869 | 20.7 % | 17.6 % | 1.4 |
Dallas–Fort Worth, TX | 55.6 | $1,855 | 40.1 % | 24.8 % | 6.1 |
Houston, TX | 52.4 | $1,613 | 24.5 % | 12.9 % | 4.9 |
Washington, DC | 56.3 | $2,257 | 20.1 % | 17.8 % | 1.1 |
Miami, FL | 95.9 | $2,827 | 59.5 % | 18.9 % | 24.3 |
Philadelphia, PA | 53.2 | $1,793 | 28.5 % | 17.2 % | 4.7 |
Atlanta, GA | 60.8 | $2,002 | 54.0 % | 16.4 % | 14.8 |
Phoenix, AZ | 60.6 | $1,938 | 66.7 % | 19.2 % | 17.2 |
Boston, MA | 64.7 | $2,806 | 22.4 % | 23.3 % | -0.3 |
San Francisco, CA | 72.7 | $3,199 | 15.0 % | 16.3 % | -1.2 |
Riverside, CA | 90.5 | $2,584 | 53.8 % | 24.4 % | 17.3 |
Detroit, MI | 43.7 | $1,460 | 36.2 % | 27.9 % | 2.7 |
Seattle, WA | 56.3 | $2,285 | 29.4 % | 12.4 % | 7.4 |
Minneapolis–St. Paul, MN | 46.1 | $1,632 | 21.2 % | 20.3 % | 0.3 |
San Diego, CA | 85.5 | $3,105 | 46.9 % | 27.0 % | 11.6 |
Tampa, FL | 69.2 | $2,135 | 65.5 % | 17.1 % | 20.1 |
Denver, CO | 54.9 | $2,028 | 30.1 % | 28.2 % | 0.8 |
St. Louis, MO | 37.1 | $1,273 | 31.3 % | 31.2 % | 0.0 |
Baltimore, MD | 53.7 | $1,798 | 22.7 % | 21.8 % | 0.4 |
Charlotte, NC | 54.8 | $1,824 | 46.4 % | 19.4 % | 10.1 |
Orlando, FL | 67.0 | $2,045 | 53.9 % | 28.2 % | 11.2 |
San Antonio, TX | 55.1 | $1,518 | 32.9 % | 21.2 % | 4.8 |
Portland, OR | 54.3 | $1,949 | 30.3 % | 28.1 % | 0.9 |
Sacramento, CA | 67.6 | $2,326 | 41.2 % | 21.8 % | 9.3 |
Las Vegas, NV | 64.7 | $1,832 | 55.9 % | 25.2 % | 12.8 |
Pittsburgh, PA | 45.1 | $1,338 | 27.0 % | 16.7 % | 3.7 |
Austin, TX | 58.0 | $1,912 | 42.6 % | 17.5 % | 10.2 |
Cincinnati, OH | 48.9 | $1,505 | 41.9 % | 19.9 % | 7.6 |
Kansas City, MO | 45.9 | $1,364 | 36.8 % | 12.4 % | 8.2 |
Columbus, OH | 52.5 | $1,509 | 39.3 % | 15.6 % | 8.9 |
Indianapolis, IN | 50.4 | $1,483 | 44.8 % | 9.6 % | 12.3 |
Cleveland, OH | 43.6 | $1,370 | 31.3 % | 21.1 % | 3.4 |
San Jose, CA | 66.3 | $3,341 | 15.7 % | 18.1 % | -1.4 |
Nashville, TN | 59.9 | $1,906 | 40.7 % | 26.0 % | 6.3 |
Virginia Beach, VA | 56.3 | $1,648 | 35.5 % | 19.6 % | 6.6 |
Providence, RI | 62.3 | $1,986 | 50.4 % | 21.9 % | 11.8 |
Jacksonville, FL | 55.7 | $1,810 | 53.5 % | 17.3 % | 13.1 |
Milwaukee, WI | 37.4 | $1,243 | 24.5 % | 19.5 % | 1.5 |
Oklahoma City, OK | 45.5 | $1,316 | 29.9 % | 22.9 % | 2.5 |
Raleigh, NC | 55.5 | $1,793 | 42.4 % | 18.1 % | 9.4 |
Memphis, TN | 54.7 | $1,501 | 49.0 % | 23.3 % | 9.5 |
Richmond, VA | 51.1 | $1,613 | 40.2 % | 28.6 % | 4.2 |
New Orleans, LA | 53.6 | $1,527 | 27.4 % | 13.8 % | 5.7 |
Louisville, KY | 46.2 | $1,293 | 33.4 % | 22.2 % | 3.9 |
Salt Lake City, UT | 52.0 | $1,764 | 45.1 % | 24.0 % | 7.5 |
Hartford, CT | 47.5 | $1,707 | 30.5 % | 13.4 % | 6.2 |
Buffalo, NY | 41.4 | $1,255 | 35.1 % | 22.5 % | 3.9 |
Birmingham, AL | 44.0 | $1,326 | 31.5 % | 22.1 % | 3.1 |
*Table ordered by market size |
**The U.S. estimate uses October 2022 rent and wage data. Estimates for each metro area use September 2022 rent and wage data. October 2022 wage data is not yet available at the metro level. |
1 Estimates for hours of work needed to pay rent using average hourly earnings data from the U.S. Bureau of Labor Statistics (source: https://fred.stlouisfed.org/series/CES0500000003) and rent data according to the Zillow Observed Rent Index. The U.S. estimate uses October 2022 rent and wage data. Estimates for each metro area use September 2022 rent and wage data. October 2022 wage data is not available at the metro level at the time of this release. |
Source: Zillow
