AgentIndustry News

In most markets, rent is too darn high

According to Zillow, renters are spending twice as much of their income on housing than homeowners are on their mortgage payments

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Takeaways: Escalating rent prices are eating up a significant portion of renters’ income. Renters can expect to spend 30 percent of their income on rent -- the highest percentage we have seen to date. Buyers can expect to spend 15 percent of their monthly income on a monthly mortgage payment. Although renting an apartment or home makes a lot of sense for some people, escalating rent prices are eating up a significant portion of renters’ income, according to a Zillow analysis of U.S. rental and mortgage affordability in the second quarter. Renters can expect to spend 30 percent of their income on rent -- the highest percentage we have seen to date -- while buyers can expect to spend 15 percent of their monthly income on a mortgage payment, Zillow said. Prior to the real estate market collapse, renters could expect to pay about 24.4 percent of their incomes on rent. From 1985 through 2000, homeowners spent about 21.3 percent of their monthly income on mortgag...