Rent Was Too Damn High. Now It’s Even Higher

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The data on housing costs isn’t pretty. Most experts recommend spending no more than one-third of your income on housing, and yet, in a new study, nearly one in four American households now spends more than half of its income on housing. Renters are experiencing especially tough times of late: At the same time that renters’ incomes have fallen 4%, money spent on housing has increased by 4%.

In the new report from the nonprofit Center for Housing Policy, there has been a marked rise in Americans facing a “severe housing cost burden.” That’s the term for households that spend more than half of their income paying for housing. In 2008, 21.8% of American households fit the profile. Fast-forward to 2010 (the most recent year tracked in the study), and the figure hit 23.6%.

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Renters are more likely than owners to face such formidable housing costs. In 2010, while 21.6% of owners spent at least half of their income on housing (up from 20.8% in 2008), 25.6% of renters were confronted with the same hefty burden (up from 22.8% in 2008).

According to the report, renters have been getting squeezed on both ends: From 2008 to 2010, the average household income of renters declined by 4%, while housing costs—rent, but also insurance and utilities—increased by 4%. That represents a swing of 8% less money in the possession of renters.

By most accounts, the burden on renters has only gotten worse in recent months. While housing prices for buyers have remained flat or even decreased in many cases, rent costs have been escalating. The New York Times notes that rent prices nationwide last month were 2.4% higher than January 2011.

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The Nashville Tennessean, meanwhile, cites data indicating that landlords aren’t as likely to cut tenants breaks as they were a couple of years ago:

About a quarter of all apartments nationwide offered some type of concession in last year’s fourth quarter. By comparison, 53% of apartments offered concessions in the first quarter of 2010, according to data tracker MPF Research’s latest report.

While the data show that it’s a fine time to be a landlord, it’s still not necessarily a good time for everyday homeowners.

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Unlike renters, whose housing costs increased from 2008 to 2010, costs for owners actually declined over that span by 2%. But as the real estate market collapsed, owners were hammered by declining home values, essentially making them poorer by the day. The average household income of homeowners also declined by 5% over those years, compared to a 4% decrease among renters.

Brad Tuttle is a reporter at TIME. Find him on Twitter at @bradrtuttle. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.

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