The Income Needed to Pay Rent in the 10 Largest U.S. Cities

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As a result of the coronavirus pandemic, many Americans have had trouble covering expenses — especially rent — in recent months.

According to data from the National Multifamily Housing Council, less than 88% of apartment households made a full or partial July rent payment as of the 13th of the month.

Though this marks an increase relative to April 2020, it is roughly 3 percentage points lower than one year earlier. In July 2019, 90.1% of rent payments were made by the 13th of the month.

The U.S. Department of Housing and Urban Development (HUD) recommends a rent-to-income ratio of less than 30% and considers households that spend more than 30% of their income on housing to be cost-burdened. Using HUD’s guidelines, SmartAsset set a 28% rent-to-income ratio and examined the income needed to pay rent in America’s largest cities in this study.

In this study, SmartAsset looked at rent data on the 25 largest U.S. cities. We estimated the household income renters would need to afford the average two-bedroom apartment while paying no more than 28% of their total income in rent. To find this number, we divided the average annual cost of a two-bedroom apartment by 0.28.

We ranked cities from highest to lowest according to the resulting figure, i.e., the annual income needed for rent costs to be equal to or less than 28% of household income.

Data on two-bedroom rents for each city is the average from January 2020 through April 2020 and was pulled from Zumper, a company that publishes research on houses and apartments for rent throughout the U.S.

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