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25 most unaffordable U.S. metros for renters

With rental prices skyrocketing and real wages remaining stagnant, renters across the country are allocating a higher percentage of their spending to housing costs. There are currently over 42 million renter households in the U.S. (36 percent of total households), which represents the highest percentage of renters in more than 50 years. Additionally, many of these renters are categorized as low-income, which has significant implications for urban policy and housing development on a larger scale. Not surprisingly, the issue of affordable housing has become increasingly prominent over the past few years.

According to the Department of Housing and Urban Development (HUD), affordable housing is defined as a living space (including utilities) for which the householder spends no more than 30 percent of his or her income. Any percentage higher than this amount puts a significant financial burden on the renter and increases the risk that the person will not be able to make payments on time or will not be able to afford other necessities such as food or healthcare. A 2017 report by the Federal Reserve states that renters in the bottom 20 percent of the income distribution spend more than half of their monthly income on rent, and that the amount of income this group spends on rent has increased 10 percentage points since 2000. After paying rent, the typical renter in this group has less than $500 per month left over for other basic expenses.

While housing affordability is a nationwide problem, the “renter wage gap” in some parts of the country is worse than in others. Using data from the U.S. Census Bureau, the U.S. Bureau of Labor Statistics, and Zillow, Credit Sesame looked at the largest 150 metropolitan areas to determine the largest gap between renters’ actual wages and the wages they would need to make in order to afford the median rent for a 1-bedroom apartment.

Takeaways

  • Nationwide, the median list price for a one-bedroom apartment in 2017 was just north of $1,400 per month. This would require a renter to make a minimum of $27.04 per hour to cover the cost without spending more than 30 percent of income towards rent.
  • The estimated hourly wage for U.S. renters in 2017 was $11.53 per hour, or 57 percent lower than the minimum amount required to cover a typical one-bedroom apartment.
  • While hourly wages and rental prices show a positive correlation across the major metropolitan areas, there is still significant variation that cannot be predicted by those two factors alone. This results in a wide range of affordability across the U.S.
  • Ten of the 25 least affordable metros are located in California alone; almost all are near the coasts.
  • Out of all 150 metros analyzed, there were only three in which renters earned more than needed to cover the cost of a one-bedroom apartment. Those metros were Fort Wayne, IN, Fort Smith, AR-OK, and Killeen-Temple, TX.

Below are the 25 most unaffordable metros for renters. Full results for the largest 150 metropolitan areas can be found on Credit Sesame.

The 25 most unaffordable metros for renters

25. Fort Collins, CO

  • Renter wage gap: -53%
  • Hourly wage needed to pay rent: $23.06
  • Estimated hourly wage for renters: $10.83
  • Median 1-bedroom rent: $1,199
  • Number of renter households: 45,386 (36% of total)

Philadelphia, PA skyscrapers and skyline at sunrise reflect golden light in Delaware River, as seen from Camden, NJ. (Photo by: Joe Sohm/Visions of America/UIG via Getty Images)

24. Philadelphia-Camden-Wilmington, PA-NJ-DE-MD

  • Renter wage gap: -53%
  • Hourly wage needed to pay rent: $24.10
  • Estimated hourly wage for renters: $11.24
  • Median 1-bedroom rent: $1,253
  • Number of renter households: 729,007 (33% of total)

23. Minneapolis-St. Paul-Bloomington, MN-WI

  • Renter wage gap: -53%
  • Hourly wage needed to pay rent: $24.46
  • Estimated hourly wage for renters: $11.48
  • Median 1-bedroom rent: $1,272
  • Number of renter households: 407,618 (30% of total)

22. Portland-South Portland, ME

  • Renter wage gap: -53%
  • Hourly wage needed to pay rent: $24.62
  • Estimated hourly wage for renters: $11.51
  • Median 1-bedroom rent: $1,280
  • Number of renter households: 63,686 (30% of total)

21. Salinas, CA

  • Renter wage gap: -53%
  • Hourly wage needed to pay rent: $27.50
  • Estimated hourly wage for renters: $12.90
  • Median 1-bedroom rent: $1,430
  • Number of renter households: 63,315 (50% of total)

20. Riverside-San Bernardino-Ontario, CA

  • Renter wage gap: -54%
  • Hourly wage needed to pay rent: $25.04
  • Estimated hourly wage for renters: $11.50
  • Median 1-bedroom rent: $1,302
  • Number of renter households: 504,138 (38% of total)

19. Naples-Immokalee-Marco Island, FL

  • Renter wage gap: -55%
  • Hourly wage needed to pay rent: $25.29
  • Estimated hourly wage for renters: $11.26
  • Median 1-bedroom rent: $1,315
  • Number of renter households: 37,288 (28% of total)

18. Urban Honolulu, HI

  • Renter wage gap: -55%
  • Hourly wage needed to pay rent: $32.60
  • Estimated hourly wage for renters: $14.70
  • Median 1-bedroom rent: $1,695
  • Number of renter households: 139,328 (45% of total)


Photo Credit: Jon Helgason / Alamy Stock Photo

17. Seattle-Tacoma-Bellevue, WA

  • Renter wage gap: -55%
  • Hourly wage needed to pay rent: $34.04
  • Estimated hourly wage for renters: $15.35
  • Median 1-bedroom rent: $1,770
  • Number of renter households: 570,269 (40% of total)

16. New Orleans-Metairie, LA

  • Renter wage gap: -56%
  • Hourly wage needed to pay rent: $22.12
  • Estimated hourly wage for renters: $9.78
  • Median 1-bedroom rent: $1,150
  • Number of renter households: 185,710 (39% of total)

15. Providence-Warwick, RI-MA

  • Renter wage gap: -56%
  • Hourly wage needed to pay rent: $23.06
  • Estimated hourly wage for renters: $10.21
  • Median 1-bedroom rent: $1,199
  • Number of renter households: 246,207 (40% of total)

14. Vallejo-Fairfield, CA

  • Renter wage gap: -56%
  • Hourly wage needed to pay rent: $29.19
  • Estimated hourly wage for renters: $12.79
  • Median 1-bedroom rent: $1,518
  • Number of renter households: 59,232 (41% of total)

13. San Diego-Carlsbad, CA

  • Renter wage gap: -57%
  • Hourly wage needed to pay rent: $33.73
  • Estimated hourly wage for renters: $14.35
  • Median 1-bedroom rent: $1,754
  • Number of renter households: 521,493 (47% of total)

12. Chicago-Naperville-Elgin, IL-IN-WI

  • Renter wage gap: -59%
  • Hourly wage needed to pay rent: $27.89
  • Estimated hourly wage for renters: $11.33
  • Median 1-bedroom rent: $1,450
  • Number of renter households: 1,240,948 (36% of total)

11. Santa Rosa, CA

  • Renter wage gap: -59%
  • Hourly wage needed to pay rent: $33.81
  • Estimated hourly wage for renters: $13.82
  • Median 1-bedroom rent: $1,758
  • Number of renter households: 76,269 (40% of total)


Photo Credit: Sean Pavone / Alamy Stock Photo

10. Nashville-Davidson–Murfreesboro–Franklin, TN

  • Renter wage gap: -60%
  • Hourly wage needed to pay rent: $27.56
  • Estimated hourly wage for renters: $11.13
  • Median 1-bedroom rent: $1,433
  • Number of renter households: 234,730 (35% of total)

9. San Jose-Sunnyvale-Santa Clara, CA

  • Renter wage gap: -60%
  • Hourly wage needed to pay rent: $48.08
  • Estimated hourly wage for renters: $19.41
  • Median 1-bedroom rent: $2,500
  • Number of renter households: 278,890 (43% of total)

8. Miami-Fort Lauderdale-West Palm Beach, FL

  • Renter wage gap: -61%
  • Hourly wage needed to pay rent: $30.42
  • Estimated hourly wage for renters: $11.78
  • Median 1-bedroom rent: $1,582
  • Number of renter households: 824,097 (40% of total)

7. Bridgeport-Stamford-Norwalk, CT

  • Renter wage gap: -62%
  • Hourly wage needed to pay rent: $32.62
  • Estimated hourly wage for renters: $12.55
  • Median 1-bedroom rent: $1,696
  • Number of renter households: 108,502 (32% of total)

6. Oxnard-Thousand Oaks-Ventura, CA

  • Renter wage gap: -62%
  • Hourly wage needed to pay rent: $32.92
  • Estimated hourly wage for renters: $12.38
  • Median 1-bedroom rent: $1,712
  • Number of renter households: 98,461 (37% of total)

5. Santa Maria-Santa Barbara, CA

  • Renter wage gap: -62%
  • Hourly wage needed to pay rent: $34.04
  • Estimated hourly wage for renters: $12.99
  • Median 1-bedroom rent: $1,770
  • Number of renter households: 68,611 (48% of total)

4. Boston-Cambridge-Newton, MA-NH

  • Renter wage gap: -62%
  • Hourly wage needed to pay rent: $38.27
  • Estimated hourly wage for renters: $14.70
  • Median 1-bedroom rent: $1,990
  • Number of renter households: 689,800 (39% of total)

3. Los Angeles-Long Beach-Anaheim, CA

  • Renter wage gap: -65%
  • Hourly wage needed to pay rent: $37.58
  • Estimated hourly wage for renters: $13.19
  • Median 1-bedroom rent: $1,954
  • Number of renter households: 2,217,775 (52% of total)

JERSEY CITY, NJ – SEPTEMBER 16: The sun reflects off One World Trade Center at sunset in New York City on September 16, 2018 as seen from Jersey City, New Jersey. (Photo by Gary Hershorn/Getty Images)

2. New York-Newark-Jersey City, NY-NJ-PA

  • Renter wage gap: -66%
  • Hourly wage needed to pay rent: $40.90
  • Estimated hourly wage for renters: $13.87
  • Median 1-bedroom rent: $2,127
  • Number of renter households: 3,460,165 (49% of total)

1. San Francisco-Oakland-Hayward, CA

  • Renter wage gap: -67%
  • Hourly wage needed to pay rent: $51.29
  • Estimated hourly wage for renters: $17.06
  • Median 1-bedroom rent: $2,667
  • Number of renter households: 775,476 (46% of total)

Methodology & full results

Monthly rental prices for each metropolitan area were sourced from Zillow. The prices shown are for 1-bedroom apartments in 2017. Using Zillow rent prices, an estimate for the hourly wage needed to afford a 1-bedroom rental was calculated. For this calculation, we assumed a 40-hour workweek and that individuals would spend no more than 30 percent of gross income on rent.

To calculate the estimated hourly wage for renters, median hourly wages were sourced from the U.S. Bureau of Labor Statistics May 2017 Occupational Employment Statistics. These wages were then adjusted by the ratio of renter household income to overall household income using figures from the U.S. Census Bureau 2016 American Community Survey (ACS) 5-year Estimates. The number (and percent) of renter households was also determined using data from the 2016 American Community Survey.

The renter wage gap is the percent difference between the estimated hourly wage for renters and the hourly wage needed to pay rent. Only the largest 150 metropolitan areas were included in the analysis. The final list is ordered by renter wage gap. In the event of a tie, cities with higher hourly wages needed to pay rent were ranked higher.

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