In recent years, the soaring cost of renting in the United States has left many households struggling to make ends meet. However, there is some hope on the horizon as an increase in the construction of multiple-unit buildings is slowly helping to curb skyrocketing rents. Nationally, rents have been declining for the eighth consecutive month, with the median asking rent dropping to $1,713, down $4 from the previous month and $63 from its peak in July 2022. Despite this improvement, the median rent is still 22% higher than in 2019, before the pandemic.
Millions of households feel the burden of high rent, with 22.4 million paying more than a third of their income in rent, commonly considered a cost burden. Shockingly, 12 million renters are severely cost-burdened, spending more than half of their income on housing. The situation has led to record-high numbers of people facing homelessness, and evictions are on the rise as pandemic protections have expired.
While rents are cooling off, the affordability crisis remains a pressing issue. The pandemic and an existing shortage of multifamily housing in some areas led to surging rents in 2021 and 2022. However, the rental market is beginning to stabilize thanks to increased supply, even in notoriously expensive cities like Manhattan.
The surge in multifamily building construction has been remarkable, with the highest levels in decades. Still, builders are grappling with rising costs, leading to forecasts of a 20% decrease in multifamily construction next year. Without a sustained increase in new supply and enhanced rental support, affordability will continue to be a significant concern for renters………[read more]
Considering the complex dynamics of the rental market, what factors do you think businesses and policymakers should prioritize to address the ongoing affordability crisis for renters?
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