Many Californians now require a six-figure income to afford rent comfortably, according to a recent report by Zillow. The analysis highlights that five of the eight U.S. metropolitan areas where this income level is necessary are located in California. These areas include San Jose, San Francisco, San Diego, Los Angeles, and Riverside.
Since April 2020, rent for a typical U.S. apartment has increased by 28.7%, reaching $1,858, while single-family home rents have surged by 42.9% to $2,256. Meanwhile, the median household income has only risen by 22.5% to approximately $82,000, indicating that wages have not kept pace with the rising cost of rent. As a result, renters in many major cities are now spending more than 30% of their income on housing, which is considered the threshold for being rent-burdened.
Zillow’s report states that in cities like San Jose and San Francisco, wages have kept up better with rent increases, with median households spending 25% and 28% of their income on rent, respectively. However, in other cities like New York and Boston, renters face additional challenges due to high upfront costs, including broker fees and security deposits.
The number of cities where renters need to earn $100,000 to afford rent has doubled since 2020, reflecting the growing affordability gap. According to GlobeSt, the highest spikes in income requirements were seen in Miami, Riverside, and San Diego, with increases of 54.4%, 45.6%, and 40.8%, respectively.
Despite these challenges, some markets remain affordable. Cities like Buffalo, Oklahoma City, and Louisville require significantly lower incomes, with renters spending 23% or less of their income on rent.
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