Paying rent still a problem for 24% of renters

Some renters are having difficulty paying their rent.

About 24% of American renters are experiencing rent affordability issues amid high rent prices and other factors, according to a survey put out Monday by Intuit Credit Karma. 

The company said the total share of adult Americans who rented amounted to 36%. Its survey involved over 1,200 U.S. adults and took place online from Nov. 20-26. 

Slightly under one-third of millennial renters – 30% – indicated they had trouble covering their rent, according to Intuit Credit Karma. For Generation Z, it was 27%.

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Meanwhile, one in 10 Americans 69 and older reported they "can no longer afford to pay their rent," the survey said.

In a separate report from Monday, online real estate brokerage Redfin pegged the median U.S. asking rent in December at $1,964. That marked a 0.2% month-over-month decrease. However, the median price that landlords were asking renters to pay in December remained only 4.4% cheaper than the record $2,054 seen in August 2022, according to Redfin.

"High supply – more so than low demand – is driving rent declines. But if mortgage rates continue to drop at a fast clip in 2024, slowing rental demand could become a major driver of rent declines. That’s because more Americans would ditch the rental market to become homeowners, leaving landlords with even more vacancies," Chen Zhao, the economics research lead at Redfin, said.

Thirty-year fixed mortgages averaged a rate of 6.62% for the week of Jan. 4, according to Freddie Mac.

About 38% of renters said the need to cover rent has prompted them to give up certain necessities, the Intuit Credit Karma survey further found.

The inability to afford rent was pushing 19% of renters to look to their family and friends for housing, with the share of Gen Zers and millennials reporting doing so coming in at 25%, per the survey. 

Intuit Credit Karma also found 46% of Americans harbored gloomy outlooks about their prospects of ever buying a home.

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"Our research shows more than half of Americans (57%) allocate the majority of their income toward housing costs, leaving little room elsewhere in their budgets," Intuit Credit Karma consumer financial advocate Courtney Alev. "In general, it’s recommended that consumers allocate half of their income for essentials, including housing and other necessities, like groceries and household bills."

The median asking rent in America has posted declines three months in a row, according to Redfin. On an annual basis, December’s price represented a 0.8% drop.

The online real estate brokerage linked the price going down to the current high number of rentals available in the market as well as other factors. 

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