High housing prices and high rents are becoming more and more connected as recent research shows 58 percent of 1,300 renters feel "stressed" about their rent, with many survey respondents claiming they can't save for future purchases, like a house.
The U.S. currently has a 7.3 percent national vacancy rate, despite apartment construction in core cities, as the new buildings are too costly for many renters. Meanwhile, many cities on the west coast in particular are experiencing overcrowding. Joel Kotkin's analysis in Forbes and NewGeography claims this stress points to a larger crisis -- the number of home purchases is in decline, negatively affecting the U.S. GDP.
The home-buying struggles of Americans, particularly millennials, have been well documented. Yet a recent study by Hunt.com found that the often-proposed “solution” of renting is not much of a panacea. Rents as a percentage of income, according to Zillow, are now at a historic high of 29.1 percent, compared with the 25.8 percent rate that prevailed from 1985 to 2000.
Advertisement
Related Stories
Market Data + Trends
Vacation and Investment Home Market Insights
A recent report finds beach homes to be the most sought-after vacation-home type and that the investment potential of a second home is an important factor in the purchasing decision
Affordability
How Much Income Do First-Time Buyers Need to Afford the Average Home?
The median-priced home is unaffordable in 44 of the 50 largest U.S. metro areas
Affordability
What Is the Relationship Between Urban vs. Suburban Development and Affordability?
A new paper from Harvard's Joint Center looks at whether expanding the supply of suburban housing could, in turn, help make dense urban areas more affordable