RICHMOND, Va. — As the cost of living continues to climb nationwide, affordable housing is becoming increasingly elusive for many Americans. In Richmond, the income required to comfortably afford rent has surged to over $68,000 annually — a 40% increase since 2020 — reflecting a broader trend that is pricing out many renters.
According to recent data from Zillow, renters across the country now need to earn more than $80,000 per year to comfortably cover rent costs, up from approximately $60,000 five years ago. This rise underscores a growing disconnect between wage growth and rental prices.
“Housing costs have surged since pre-pandemic, with rents growing quite a bit faster than wages,” said Orphe Divounguy, Senior Economist at Zillow. He noted that since April 2020, the typical U.S. household’s rent has jumped by $1,858, a 28.7% increase. During the same period, median household income increased by only 22.5%, rising to roughly $82,000.
This imbalance leaves many renters financially stretched, often spending close to or above the commonly accepted threshold of 30% of income on housing costs. In Richmond, the rent affordability rate stands at just 22.7%, with many residents just on the edge of this rent burden margin.
High rent prices in major metropolitan areas exacerbate the problem. Cities such as San Jose, New York, Boston, San Diego, San Francisco, Los Angeles, Miami, and Riverside require renters to earn six-figure incomes to remain under the 30% rent burden threshold, with rental prices in these markets significantly exceeding the national average of $2,024 per month.
Divounguy further explained that these high housing costs not only strain renters’ monthly budgets but also hamper their ability to save for future homeownership. “High upfront costs are often overlooked, which can keep renters in their current homes,” he said.
Despite these challenges, some cities remain relatively affordable. Markets like Buffalo, New York; Oklahoma City; and Louisville, Kentucky, have average annual income requirements ranging from $55,000 to $57,000 to afford rent, with renters spending roughly 23% or less of their income on housing.
As rental prices continue to outpace wage growth, affordable housing remains a critical issue for policymakers and residents alike, highlighting the need for innovative solutions to address the widening affordability gap.
