SEATTLE, Sept. 30, 2021 /PRNewswire/ -- The Great
Reshuffling has the potential to improve housing
affordability for millions of Americans able to work remotely
from a less expensive market. But for occupations that require
in-person work — teachers and nurses, for example — affordability
is becoming more of a challenge as rent growth sets new records.
Many renters in those in-person jobs are battling for a small slice
of the rental market comprising smaller, older homes, a new Zillow®
analysis shows.
The analysis highlights the impact that more than a decade of
underbuilding has had on renters as well as the need for
communities to make it easier to build homes. New construction in
the U.S. has fallen behind by millions of homes since the
Great Recession, helping fuel record home value growth and
increasing pressure on the rental market.
"Many renters have been able to keep costs low even as prices
have grown over the past several years, but merely affording rent
does not mean they are thriving," said Zillow economic data analyst
Nicole Bachaud. "A deeper look shows
a big slice of the market is out of reach for workers looking to
maintain a comfortable rent burden. That often means renting an
older home with less space but a smaller price tag, or doubling up
with roommates or a partner."
While rent burdens — the share of income spent on rent — can
appear low, especially when compared with recent growth in rent
prices, renters often live with roommates or a partner, or target
less desirable homes to keep housing costs manageable. The typical
teacher spends about 22% of their income on rent, well below the
widely accepted 30% rule for housing affordability. That's up only
slightly from roughly 20% of income spent on rent five years ago,
despite rent prices growing almost 24% over that period. To keep
their rent costs this low, only a fraction of the rental market is
available to teachers.
In Boston, for example,
teachers on average only spend about 18.5% of their income on rent,
down from about 20% in August 2016.
But to do so, they must choose from only 6% of rentals in
Boston that are priced low enough.
Those homes are almost 300 square feet smaller and 33 years older
than the typical Boston rental.
While age does not always tell the whole story when it comes to
quality, living in an older home increases the likelihood of living
in unhealthy or unsafe conditions.
Even in Tampa, where teachers
spend almost 28% of their income on rent, just under the 30%
affordability threshold and much higher than the 17.2% they spent
five years ago, teachers are limited in their rental options. Only
2.2% of the Tampa rental market is
available for teachers who don't want to exceed that share of
income spent on rent each month.
One way for communities to ease price pressures on renters is to
make it easier to create new inventory, including relaxing zoning
restrictions. Basic supply and demand is the primary driver of
growing housing costs, so increasing the supply of affordable
housing types can help meet demand. Zillow research has shown that
even modest densification could exceed what is likely needed
to meaningfully slow housing price growth over the long term.
"Boosting supply is the clearest path to improving
affordability," Bachaud said. "Allowing for even small amounts of
new density could have a big impact on prices."
Nurses face similar hurdles in finding an affordable rental.
While nurses who rent live affordably in all large metros according
to the 30% rule, they are renting homes at least 100 square feet
smaller than the typical rental in each market. In San Diego, where nurses spend about 24.5% of
their income on rent, only 8% of rentals are affordable at that
rent burden.
Portland, Ore. is the most
equitable rental market for nurses, with nearly two-thirds (63.4%)
of the market available for nurses who spend 17.3% or less of their
income on rent. The median rental available at that rent burden is
111 square feet smaller than the typical Portland rental, the second-smallest
difference of any large market; affordable rentals for nurses in
Washington, D.C., are 108 square
feet smaller than a typical rental.
Metro
Area
|
Typical Rent Price
in the Metro
|
Median Rent
Paid
|
Median Rent
Burden
|
Share of Rental
Market Available at Current Rent Burden
|
Median Rent
Paid
|
Median Rent
Burden
|
Share of Rental
Market Available at Current Rent Burden
|
New York,
NY
|
$2,693
|
$936
|
18.5%
|
7.8%
|
$1,036
|
15.8%
|
5.2%
|
Los Angeles-Long
Beach-Anaheim, CA
|
$2,630
|
$933
|
22.8%
|
8.2%
|
$1,374
|
20.3%
|
12.6%
|
Chicago,
IL
|
$1,721
|
$675
|
19.0%
|
15.8%
|
$747
|
16.4%
|
19.3%
|
Dallas-Fort Worth,
TX
|
$1,684
|
$807
|
18.0%
|
13.2%
|
$1,118
|
17.6%
|
23.9%
|
Philadelphia,
PA
|
$1,705
|
$809
|
18.3%
|
7.3%
|
$1,358
|
21.0%
|
13.0%
|
Houston,
TX
|
$1,519
|
$895
|
19.4%
|
29.5%
|
$912
|
15.9%
|
31.3%
|
Washington,
DC
|
$2,125
|
$895
|
17.8%
|
18.3%
|
$924
|
16.2%
|
26.3%
|
Miami-Fort
Lauderdale, FL
|
$2,343
|
$841
|
23.8%
|
3.8%
|
$909
|
21.7%
|
2.6%
|
Atlanta,
GA
|
$1,827
|
$719
|
18.2%
|
0.9%
|
$1,056
|
22.2%
|
3.0%
|
Boston, MA
|
$2,532
|
$901
|
18.5%
|
6.3%
|
$895
|
14.2%
|
2.7%
|
San Francisco,
CA
|
$3,092
|
$1,068
|
20.9%
|
13.3%
|
$1,686
|
17.0%
|
19.5%
|
Detroit,
MI
|
$1,397
|
N/A
|
N/A
|
N/A
|
$649
|
14.4%
|
24.3%
|
Riverside,
CA
|
$2,393
|
$927
|
27.1%
|
3.4%
|
$1,133
|
19.1%
|
8.1%
|
Phoenix,
AZ
|
$1,806
|
$587
|
17.8%
|
2.8%
|
$910
|
13.4%
|
6.8%
|
Seattle,
WA
|
$2,194
|
$971
|
21.7%
|
12.2%
|
$1,187
|
20.7%
|
25.4%
|
Minneapolis-St. Paul,
MN
|
$1,590
|
$827
|
20.6%
|
28.6%
|
$899
|
19.3%
|
44.0%
|
San Diego,
CA
|
$2,649
|
$1,224
|
24.5%
|
13.2%
|
$1,494
|
20.8%
|
8.4%
|
St. Louis,
MO
|
$1,191
|
$541
|
12.0%
|
12.8%
|
$734
|
12.8%
|
38.5%
|
Tampa, FL
|
$1,876
|
$917
|
28.0%
|
2.2%
|
$1,025
|
19.5%
|
8.7%
|
Baltimore,
MD
|
$1,775
|
$658
|
15.3%
|
13.5%
|
$934
|
19.4%
|
22.2%
|
Denver, CO
|
$1,903
|
$820
|
22.2%
|
32.6%
|
$1,152
|
26.9%
|
50.7%
|
Pittsburgh,
PA
|
$1,218
|
$662
|
19.4%
|
17.7%
|
$987
|
18.5%
|
20.6%
|
Portland,
OR
|
$1,773
|
N/A
|
N/A
|
N/A
|
$1,107
|
17.3%
|
63.4%
|
Charlotte,
NC
|
$1,662
|
$590
|
16.0%
|
3.1%
|
$778
|
17.2%
|
6.5%
|
Sacramento,
CA
|
$2,152
|
$768
|
21.3%
|
#N/A
|
$1,193
|
13.2%
|
17.4%
|
San Antonio,
TX
|
$1,374
|
$791
|
15.8%
|
30.4%
|
$1,010
|
17.2%
|
40.0%
|
Orlando,
FL
|
$1,798
|
$1,349
|
38.1%
|
6.1%
|
$838
|
18.2%
|
9.3%
|
Cincinnati,
OH
|
$1,356
|
$571
|
14.2%
|
13.1%
|
$656
|
17.3%
|
14.7%
|
Cleveland,
OH
|
$1,261
|
$407
|
9.6%
|
15.3%
|
$706
|
12.8%
|
11.6%
|
Kansas City,
MO
|
$1,262
|
$597
|
13.9%
|
23.9%
|
$806
|
19.7%
|
45.4%
|
Las Vegas,
NV
|
$1,718
|
$699
|
16.7%
|
4.4%
|
$981
|
19.6%
|
8.5%
|
Columbus,
OH
|
$1,359
|
$736
|
16.8%
|
9.5%
|
$758
|
13.5%
|
14.9%
|
Indianapolis,
IN
|
$1,391
|
$970
|
25.1%
|
19.4%
|
$634
|
13.8%
|
26.7%
|
San Jose,
CA
|
$3,126
|
$1,175
|
20.1%
|
37.4%
|
$1,999
|
24.0%
|
53.4%
|
Austin, TX
|
$1,754
|
$744
|
20.9%
|
17.1%
|
$1,029
|
17.4%
|
25.7%
|
Virginia Beach,
VA
|
$1,527
|
$588
|
16.6%
|
5.9%
|
$731
|
13.8%
|
5.1%
|
Nashville,
TN
|
$1,768
|
$685
|
17.7%
|
6.6%
|
$792
|
19.3%
|
15.1%
|
Providence,
RI
|
$1,785
|
$642
|
16.6%
|
5.3%
|
$1,088
|
23.6%
|
8.8%
|
Milwaukee,
WI
|
$1,192
|
$431
|
12.6%
|
14.8%
|
$932
|
18.9%
|
14.9%
|
Jacksonville,
FL
|
$1,629
|
$670
|
20.8%
|
10.3%
|
$874
|
17.0%
|
6.4%
|
Memphis,
TN
|
$1,535
|
$764
|
19.8%
|
7.5%
|
N/A
|
N/A
|
N/A
|
Louisville-Jefferson
County, KY
|
$1,145
|
N/A
|
N/A
|
N/A
|
$548
|
15.4%
|
8.2%
|
Hartford,
CT
|
$1,604
|
$579
|
12.9%
|
3.3%
|
$982
|
25.2%
|
6.3%
|
Richmond,
VA
|
$1,429
|
$1,094
|
26.6%
|
12.8%
|
$1,008
|
19.0%
|
31.6%
|
New Orleans,
LA
|
$1,319
|
$517
|
13.4%
|
4.6%
|
$1,092
|
15.6%
|
27.4%
|
Buffalo,
NY
|
$1,190
|
$426
|
14.6%
|
N/A
|
N/A
|
N/A
|
N/A
|
Raleigh,
NC
|
$1,647
|
$561
|
14.6%
|
2.2%
|
$816
|
20.9%
|
8.5%
|
Birmingham,
AL
|
$1,305
|
$427
|
25.4%
|
6.1%
|
$527
|
16.8%
|
11.0%
|
Salt Lake City,
UT
|
$1,584
|
$484
|
12.9%
|
1.7%
|
N/A
|
N/A
|
N/A
|
*Table ordered by market size
About Zillow Group
Zillow Group, Inc.
(NASDAQ: Z and ZG) is reimagining real estate to make it easier to
unlock life's next chapter.
As the most-visited real estate website in the United States, Zillow® and its affiliates
offer customers an on-demand experience for selling, buying,
renting or financing with transparency and nearly seamless
end-to-end service. Zillow Offers® buys and sells homes directly in
dozens of markets across the country, allowing sellers control over
their timeline. Zillow Home Loans™, our affiliate lender, provides
our customers with an easy option to get pre-approved and secure
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Zillow Group's brands, affiliates and subsidiaries include
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SOURCE Zillow