The real median gross cost of renting — rent plus the average monthly cost of utilities and fuels adjusted for inflation — grew faster annually (3.8%) than real median home values (1.8%) in 2023 for the first time in 10 years, according to the 2023 American Community Survey (ACS) released today.

This marked the largest annual real increase in rental costs since at least 2011.

The fact that the gross rent share of income did not rise nationally and in most states despite significant increases in rental costs could be due to higher renters’ incomes or to an increase in higher-income households joining the population of renters.

Every year from 2011 to 2019, real rent costs increased less than 3.0%. In 2022, after the peak of the COVID-19 pandemic, rent grew 1.0% — only one-fourth of the 2023 increase (Table 1).

Despite this large spike, the share of renter income spent on rent and utilities remained at 31.0% in 2023, an indication that renter household incomes kept pace with rent hikes.

Table 1. Median Gross Rent: Growth and Percentage of Income

Rent Costs by State

Most states saw no significant change in the ratio of gross rent to renters’ income (Figure 1).

Six states saw a decline in the share of renters’ incomes going to rent: Illinois, Kansas, Minnesota, New Mexico, New York and West Virginia.

Even as the rent share of income declined, rent increased by 1.6% in Illinois and 2.1% in Kansas (these growth rates were not significantly different), and by 9.1% in New Mexico.

In contrast, three states experienced a significant increase in the share of renters’ incomes going to rent in 2023: Arizona, Florida and Georgia.

Rents increased 6.5% in Arizona, 8.2% in Florida, and 6.0% in Georgia (Arizona rent growth was not significantly different from growth in Florida or Georgia).

Figure 1. Change in Gross Rent and Gross Rent Share of Income: 2022-2023

Incomes Keeping Up With Rent Increases

From 2022 to 2023, the number of renters grew, while median household income was not significantly different. However, this measure includes the income growth of nonrenters, and the income growth of renters and nonrenters may have differed.

The number of renter-occupied housing units increased by 0.9% in 2023. While changes to the cost of owning a home, such as higher interest rates or home values, could push households away from home ownership and toward renting, the share of households renting remained constant at 34.8% between 2022 and 2023.

Jacob Fabina is an economist in the U.S. Census Bureau’s Social, Economic, and Housing Statistics Division.

Related Statistics

American Community Survey (ACS)

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Largest Annual Real Increase in Gross Rental Costs Since 2011