For the past two years, renters across the U.S. have been squeezed by fast-rising rental costs paired with near-stagnant income growth, and as a result, two full-time workers earning minimum wage can comfortably afford a typical two-bedroom rental in just 10 of the 50 largest U.S. cities, Forbes reports. In San Francisco, home to the highest one-bedroom rents in the country, an hourly income of $49.01 is needed to reasonably afford a typical one-bedroom rental.
Though builders are taking on more projects in the year ahead to increase supply and lower housing costs, increasing the total number of housing units across the U.S. only solves one part of the problem. Rising inflation and slow wage growth continue to price homebuyers and renters out of an increasingly unaffordable market.
There are six cities where at least four full-time minimum wage incomes would be needed to reasonably afford a two-bedroom rental: Austin, Atlanta, Nashville, Dallas, Charlotte, North Carolina and Raleigh, North Carolina. All use the federal minimum wage of $7.25 an hour and have been among the hottest housing markets in the country in recent years. Charlotte, Dallas, Nashville and Atlanta are also among Zillow's hottest markets for 2023, making it likely that affordability will become even tighter in those markets.
Advertisement
Related Stories
Demographics
Gen Z Ranks Housing Affordability as Biggest Concern Ahead of 2024 Presidential Election
While the issue is most important to young voters, 80% of Americans rank housing affordability as a top priority when considering who will have their vote
Affordability
Cinnaire Closes $175M Equity Fund to Create or Preserve More Than 1,200 Affordable Homes in the Midwest
To date, the nonprofit organization has closed more than $5 billion in tax credits for affordable housing in 10 states
Financing
10 States Where Shopping Around for a Mortgage Really Pays Off
In California, homebuyers could see savings of more than $130,000 over the lifetime of their loans