Renters need to make roughly $20,000 more a year to afford the typical rent than they did 5 years ago
Renters need to make roughly $20,000 more a year to afford the typical rent than they did 5 years ago
“Since pre-pandemic, the income needed to afford rent has increased by 31.5%,” Zillow’s chief economist, Skylar Olsen, wrote yesterday.
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I mean... I'm up in Canada but in one of the highest cost of living cities in the country which isn't as bad as San Francisco or NYC but it's bad...
20k is 1666 a month extra.
The only thing thats gone up $1666 a month more would be a larger house.
Fancy 1 bedrooms are up to 2000-2500 and they were never $334 to 734 even 15 years ago.
Something is wrong with that headline or their math
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Rent as a percentage of income. General rule (and what I’m assuming the article is using without getting around the paywall) is 1/3 of your income should be rent. So if the avg rent in 2019 was $1666 and it’s now $2000 you should be making $80k/year instead of $60K.
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Ah, assuming that's what's behind the paywall that makes much more sense.
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I'm old enough to have learned that housing should be 1/4 of your take home pay
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That's the general rule of thumb that I learned as well... try to stay within 1/4th of salary for mortgage/rent.
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Just a small distinction. Not more than 1/3 of your income should be rent. Also this figure is based on the net income, not pre-tax
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It could be including how much food has gone up as well
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Yeah my average rent is nowhere near $20k. This headline seems like nonsense.
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if the rent is, for instance, 40% of income then the additional income is also to offset the 60% nonrental income.
eg if you pay 400 in rent and now its 700 your overall income needs to go from 1000 to 1750 to maintain the same level of affordability.
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That's a major issue about inflation - it's really just an additional tax. In inflation, cost of living goes up, income/wages do not.
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it's relative to where you live, yes.
but generally rents and housing costs have doubled the past 5 years. and doubled the ten years ebfore that, so are about triple where they were in 2009. A 2 bed in my city was 1200-1500, now it's 3000-4000 and often 3-4 people are living there to make rent. a lot of two beds were converted to 3-4 beds (remove living and dining room).
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