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Almost half of all renter households in the U.S. are rent-burdened—meaning the cost of renting swallows up more than 30% of their income.
That’s according to a new analysis of the U.S. Census Bureau’s 2022 American Community Survey (ACS) by Zillow and StreetEasy.
Gen Z renters (ages 18-25) are the most affected, with three in five spending over 30% of their household income on housing costs. In some metros, like San Diego, Los Angeles, and Sacramento, that share is even higher, with nearly three-quarters of Gen Zers struggling to pay rent.
The situation for Gen Z renters is similar but slightly better than what Millennial renters faced in 2012, when 60.2% nationwide spent over 30% of their income on housing. Among young adults, the rent burden peaked at 62% in 2011 before steadily declining to 55% in 2019.
Fast forward to the COVID pandemic, and surging rental demand, paired with decades of undersupply, drove up rents nationwide.
The experience of struggling to pay rent on an entry level salary is familiar to so many of us that it’s almost become normalized in our society. But this is something that should not be normal. Rent burden makes it a struggle for these young adults to afford the other expenses in their lives – things like student loans and medical payments. It’s deeply damaging to their ability to save for future life goals, like one day owning a home. Kenny Lee - StreetEasy Senior Economist
Gen Z and Millennial Renters (2012 to 2022)
As of 2022, nearly half of all renter households in the U.S. are considered “rent-burdened.” And among all generations of renters, Gen Z is feeling it the most, with three in five spending over 30% of their household income on rent costs.
In 21 of the 30 largest U.S. metros, the rent burden among Gen Zers is even higher, with almost three-quarters burdened by rent costs in cities like San Diego, Los Angeles, and Sacramento.
Looking back 10 years to 2012, Millennials were slightly more likely to be rent-burdened in 17 of the 30 largest metros. Slightly more than six in ten (60.2%) spent more than 30% of their income on rent. The rent burden peaked in 2011 to 62% but declined to 55% by 2019.
Since then, with the combined effect of rising rental demand and low supply, rent burden has climbed back up across the U.S., with Houston, TX, seeing the most dramatic increase in the share of rent-burdened young adults (+11.9%). Austin saw the largest decline at -9.5%.
Rent burden impacts the ability of young adults to afford other monthly payments, including student loans and medical payments. It also makes it far more difficult to save for future goals, such as buying a home.
That doesn’t stop many Gen Z renters from choosing to live in more expensive metros, often because these cities offer more job opportunities.
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