Behind the Scenes of Today's Rental Market

Harvard University's Joint Center for Housing Studies released a report in mid-December that included a number of shocking facts and statistics. Overall, demand for rental homes is increasing, leading to higher rental rates.

The Numbers:

• The proportion of American households that rent increased from 31 percent in 2004 to 35 percent in 2012.
• From 2007 to 2011, approximately 3 million homes switched from owner to rental occupancy.
• Between 2000 and 2012, median rent prices nationally increased by 6 percent. 
• Also between 2000 and 2012, the median income of renters dropped by 13 percent. Note the inverse relationship between rent prices and median income of renters. 

These trends drain renters' financial resources, forcing them to cut spending on essentials such as food, transportation, and retirement savings. For example, monthly spending on transportation decreases from $158 with affordable housing to $55 with housing cost burdens.