Industry NewsMarkets & Economy

Renters caught between rock and hard place

Report finds that rents are rising faster than wages, and slower than home prices
  • Buying a home is actually more affordable than renting in more than half, or 58 percent, of the country’s markets.
  • Rents are outpacing weekly wage growth in 57 percent of markets, and home price appreciation is outpacing rent growth in 55 percent of markets.

With rents continuing to outpace wages and home prices rising even faster than rents, “renters in 2016 will be caught between a bit of a rock and a hard place,” said RealtyTrac Vice President Daren Blomquist in discussing the company’s 2016 Rental Affordability Analysis. According to the report released today, buying a home is actually more affordable than renting in more than half, or 58 percent, of the country’s markets. Rents are outpacing weekly wage growth in 57 percent of markets, and home price appreciation is outpacing rent growth in 55 percent of markets. Average weekly wages in the second quarter of this year were up 2.6 percent from the same period last year, while median home prices in the third quarter increased 5 percent compared to last year. Rents are forecast to increase 3.5 percent next year, RealtyTrac said. Average wage earners will need to spend at least 37 percent of their income on rents for three-bedroom properties in 2016, but slightly le...