‘Cost-burdened’ renters reach all-time high, study says

The number of American renters paying unaffordable amounts for housing reached an all-time high last year, as tenants grappled with rising rents and meager income growth, a new report says.

About 21.1 million households paid more than 30% of their monthly income on housing in 2012, according to a study released Monday from the Joint Center for Housing Studies at Harvard University. That accounts for more than half of the nation’s renters. In 1960, only a quarter of households paid that much.

“We are losing ground rapidly against a chronic problem that forces households to cut essential spending,” the center’s managing director, Eric Belsky, said in a statement.

Between 2000 and 2012, the share of “cost-burdened” renters rose 12 percentage points, as tenants grappled with the effects of the Great Recession and its aftermath, the study said.

Rents have soared after the recession as more Americans shifted into the rental market, adding a new wave of demand. Between 2000 and last year, the nation’s median rent, adjusted for inflation, jumped 6%, while the median income for renters fell 13%, the study said.

Twenty-eight percent of renters paid more than 50% of their income on housing in 2011, the study said.

The high cost of housing not only takes a bite out of paychecks, but forces tenants into undesirable units. According to the study, about 13% of extremely low-income renters reside in homes with structural deficiencies.

ALSO:

FHA gives defaulted borrowers another chance

FHA to get $1.7 billion in taxpayer-funded bailout

FHA eases rules for some borrowers after bankruptcy, foreclosure