Nearly 60% of Renters saw Rent Increase in Past 12 Months

Rhea-AI Summary

Freddie Mac's recent survey reveals that nearly 60% of renters have faced rent increases over the past year, with 1 in 3 experiencing hikes of 10% or more. A mere 38% of renters reported wage gains, with one-third indicating their raises fall short of covering rising rents. Additionally, 20% of those with rent increases are likely to miss payments. The survey highlights a growing national housing affordability crisis, driven mainly by inflation, as 96% of respondents report being affected by higher costs across various categories.

Positive

• Freddie Mac is set for a record year in affordable housing initiatives.

Negative

• Almost 60% of renters experienced rent hikes, worsening housing affordability.
• Only 38% of renters saw wage increases, with many unable to cover increased rent.
• 20% of renters facing increased rent may miss payments, indicating financial strain.
• Three-quarters of renters are now less likely to buy homes, blaming high prices and interest rates.

4 in 10 saw wage gains, one-third of those say raises won’t cover increased rent

MCLEAN, Va., Aug. 15, 2022 (GLOBE NEWSWIRE) -- Nearly 60% of renters say their rents increased in the past 12 months, with a ratio of nearly 1 in 3 seeing rent increases of 10% or more, according to a newly released Freddie Mac survey. Just 38% of renters saw their wages increase, and a third say their raise won’t cover their increased rent. Nearly 1 in 5 who experienced a rent increase say they are now extremely likely to miss a payment.

“The surge in rents that took place over the last 12 months has created even greater housing uncertainty for the most vulnerable renters,” said Kevin Palmer, head of Freddie Mac Multifamily. “Our survey shows that the national housing affordability crisis is worsening, and that inflation is a key driver. Freddie Mac Multifamily is charging toward a record year for our affordable housing work, but it’s going to take a concerted, sustained and comprehensive effort to turn the tide.”

Freddie Mac’s survey sought to gauge the impact of rising prices on consumers' housing choices, and it included a panel of questions specific to renters. The nationwide online survey was conducted this year from June 6 to 10 among a representative sample of 2,000 American consumers, aged 18 and older. An in-depth look at the survey’s results is available at FreddieMac.com.

Surveyed households were almost universally impacted (96%) by higher prices in the past 12 months, with the highest percentage, 66%, pointing to increased costs for groceries and household supplies as the main drivers. Among the other most cited cost increases were those for transportation, eating out and utilities.

The survey also found that nearly three-quarters of renter households who have changed their homebuying plans this year said they’ve become at least somewhat less likely to buy a house over the past 12 months. Among those less likely to buy, 44% cite high home prices, while increased interest rates (32%) and difficulty coming up with a down payment (29%) were significant reasons for others.

Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we've made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac and Freddie Mac's blog FreddieMac.com/blog.

MEDIA CONTACT: Mike Morosi
(703) 918-5851
Michael_Morosi@FreddieMac.com  

FAQ

What percentage of renters reported rent increases according to the recent Freddie Mac survey?

Nearly 60% of renters reported rent increases in the past 12 months, with one-third facing increases of 10% or more.

What are the main reasons renters are less likely to buy homes as per the Freddie Mac survey?

The survey indicates that high home prices (44%), increased interest rates (32%), and difficulties in making a down payment (29%) are key factors.

How many renters reported wage increases according to Freddie Mac's survey?

Only 38% of renters reported seeing wage increases.

What is the implication of the Freddie Mac survey on housing affordability?

The survey underscores a worsening national housing affordability crisis, exacerbated by inflation.

What was the sample size of the Freddie Mac survey conducted in June 2022?

The survey was based on a representative sample of 2,000 American consumers aged 18 and older.