New NAHB analysis of data from the Census Bureau’s 2010 American Community Survey (ACS) reveals the state-by-state distribution of rent-burdened households. According to U.S. Department of Housing and Urban Development definitions, a renting household or family is considered “rent-burdened” if they pay more than 30 percent of their household income in gross rent (“severely rent-burdened” if they pay more than 50%).
Nationwide 19.4 million renting households (out of 39.7 million total), or 49%, pay more than 30% of their total income in rent. In fact, 25% of renting households pay more than 50% of their income in rent.
The following map charts by state the share of renting households that are rent-burdened.
The areas with the highest rates of rent burden are a mix of states that are high cost (California, New York, New Jersey, Connecticut) and those that are experiencing economic challenges as a result of the Great Recession (Florida, Michigan, Nevada and California). Florida (at 56%) and California (at 54%) have the two highest rates of rent-burdened households. These rates have grown since 2009, with Florida at 53% and California at 52% according to 2009 ACS data.
The state with the largest share of renting households paying more than 50% of their income in rent is Florida, with 30% of all renters exceeding this level. States with at least 28% of severely rent-burdened households also include California, Michigan and New Jersey.
Wyoming has the lowest rate (34%) of rent burdened households, with North and South Dakota (36% and 37% respectively) also reporting low rates.
Overall, there is a concerning linkage between states with high rates of rent-burdened households and those that are the farthest away from a construction-driven economic recovery. This conclusion indicates the importance of programs like the Low-Income Housing Tax Credit (LIHTC), which establishes a private-public partnership for the financing of affordable housing development across the nation.
And the stock of affordable housing is constantly evolving. According to a 2011 Harvard Joint Center for Housing Studies study, more than 28% of the 1999 affordable housing stock was lost by 2009 through a combination of conversions (rental to owner) and filtering (rents increasing relative to incomes). The same report noted that to develop new affordable housing would require construction costs to be just 28% of their current average.