Rental Affordability Fell in 82% of U.S. Metros

Your rent check may be buying two things at once: a roof, and a nicer roof. Renting got less affordable in 232 of 282 U.S. metros from 2014 to 2023, according to a new Mortgage Bankers Association study ^[1].

After adjusting for quality, the average renter lost the equivalent of $256 in yearly income, per the report by Syracuse University economist Gary Engelhardt ^[2]. His twist: up to half of the rise in rent spending tracks better housing, not just steeper prices ^[2].

How the study works

• National rents climbed 17% after inflation over the decade Engelhardt studied ^[3].
• Affordability improved in 50 metros, mostly smaller ones away from the coasts: "So, rental housing has not become less affordable everywhere," Engelhardt said ^[3].
• Mount Vernon-Anacortes, Wash., was a hard-hit case, where renters lost the equivalent of $1,212 a year ^[3].
• Common gauges like rent-to-income ratios blend quality and price together, which is why the MBA built a 1 new model to split them ^[3].

But the yardstick you pick changes the story. Since 2019, Zillow shows typical rent up nearly 40%, while Realtor.com shows 14.5% and Apartment List about 19% ^[3]. Harvard's Joint Center for Housing Studies also flags a jump in rental vacancy and immigration policies that could sharply cut renter household growth ^[3].

What it means for you

By our math, $256 a year is about $21 a month, while Mount Vernon-Anacortes's $1,212 works out to roughly $101 a month. For property investors, the split matters: if a tenant's bill rose $200 a month, the study suggests up to $100 of that could reflect a better unit ^[2]. Rent growth that comes from upgrades costs capital to deliver, so it is not the same as rent growth on an unchanged unit.

Zoom out

The study ends in 2023, a period when weak homebuying affordability kept many would-be buyers renting longer ^[3]. With JCHS reporting no household growth over the past 12 months, the next decade's rent math could look different ^[3].