According to the latest report from the Joint Center for Housing Studies of Harvard University on America’s Rental Housing, nearly one in four renters in the Denver Metro area are cost burdened when it comes to paying rent, spending more than half of their monthly income just to keep a roof over their heads. Renters in a few other areas, including Greeley, Boulder, and Fort Collins pay an even larger amount. Those who spend about 30% of their income towards rent are considered burdened, while there are those termed as severely burdened who pay 50% or more.
So just how many renters are cost-burdened in the Denver Metro area and which areas are the hot spots for those paying more than 30%? The report touched on the Denver, Aurora, and Lakewood areas, where the median income per year ranged at about $48,000 with a median monthly rent of $1,283. The total percentage of those simply burdened by the cost of renting, those paying 30% or more, came in at about half, while nearly a quarter fell into the severely burdened stats, those paying 50% or more.
The Effects When Renters Are Burdened
With the costs of renting too high for some, the rental market across the US has seen a slight shift. The Harvard study predicts that more people may turn towards owning versus renting, reducing the demand for rentals, and therefore encouraging landlords to keep their price increases in check. But the study also mentioned the number of renters will still continue to rise, and may increase in the number of renters in the higher income brackets.
In 2006, only 12% of households who earned $100,000 or more chose to rent, but that number increased by 6% in 2016. Between that 10-year range, nearly 40% of renter households made $100,000 or more. Denver also added close to $95,000 units that rented above $1500 per month in that time, and lost 55,000 units that rented below $1000.