Housing Costs Leave Low Income Renters with Too Few Resources for Other Necessities

An article by Jeff Larrimore and Jenny Schuetz published by the Federal Reserve, Assessing the Severity of Rent Burden on Low-Income Families, found that the lowest income renters, after paying their rent, do not have enough income remaining for other basic expenses.

In 2015, according to the Census Bureau’s Supplemental Poverty Measure (SPM), a family of four near the poverty line needed approximately $1,400 per month to pay for non-housing expenses. The poorest 20% of renters, however, had a median income of $476 left over after paying the rent. Almost 75% of the poorest renters fell short of the $1,400 threshold, but the report did not take into account certain benefits, like tax credits, that mitigate some of this shortfall.

Rent burdens have worsened over time. Among the poorest 20% of renters, the median renter spent 11 percentage points more of their income on rent in 2015 than in 2000. Rents have increased while incomes for the lowest-income renters decreased by more than $100 from 2000 to 2015. Rent burdens are a problem for the lowest income renters in all areas of the country, including both urban and rural areas and in every region.  

Assessing the Severity of Rent Burden on Low-Income Families is available at: http://bit.ly/2Db1sc1