Nearly half of U.S. renter households are burdened by high rent costs, with Gen Z renters in New York City among those shouldering the heaviest load, according to a recent report.
Nationwide, three in five Gen Z renters (ages 18-25) spend more than 30% of their income on housing—a threshold that experts deem unaffordable. In New York and other major metro areas, that share is even higher, according to a new analysis of the U.S. Census Bureau's 2022 American Community Survey (ACS) by Zillow and its local brand, StreetEasy.
While the report highlights a national issue, the rental burden in New York City mirrors trends seen in other costly urban centers like Los Angeles and San Diego, where nearly three-quarters of Gen Z renters are considered rent-burdened.
The challenges faced by today’s Gen Z renters are similar to those encountered by Millennials a decade ago, when more than 60% of young renters nationwide spent over 30% of their income on rent. The rate of rent burden among young adults briefly declined by 2019 but has surged again due to rising demand and limited housing supply post-pandemic.
“The experience of struggling to pay rent on an entry-level salary is familiar to so many of us that it’s almost become normalized in our society,” said StreetEasy Senior Economist Kenny Lee. “But this is something that should not be normal. Rent burden makes it a struggle for these young adults to afford the other expenses in their lives—things like student loans and medical payments. It’s deeply damaging to their ability to save for future life goals, like one day owning a home.”
Though some metros have seen slight improvements since 2012, at least half of Gen Z renters in every one of the nation’s 30 largest cities still experience rent burden. In New York City, high housing costs remain a significant challenge, despite small improvements compared to Millennials a decade ago.
Zillow’s report highlights the delicate balance for Gen Z renters, who often need to live in expensive urban centers like New York for career opportunities.
“While these large metropolitan areas may be known to have more expensive housing, we have to recognize that they’re also where the jobs are,” said Zillow Rental Trends Expert Emily McDonald. “For many Gen Z renters, choosing to live in a less expensive city may come at the expense of their career, which is why it’s so necessary we find ways to make living in these areas more affordable for young adults.”
