One in Five Americans Now Spend Half Their Income on Housing, Survey Finds

One in five Americans who rent or carry a mortgage now spend at least half their pre-tax income on housing, and another 49% spend between 25% and 49%, according to a new CNBC/SurveyMonkey Quarterly Money Survey released Oct. 5. Standard lender guidelines recommend spending no more than 28% to 30% of income on housing. The cost of housing has become the top political issue for voters aged 18 to 34, ranking above food costs and concerns about democracy, per CNBC's All-America Economic survey.

Nationally, it now takes an average of 26% of median income to rent a home and 28% to buy one, up from 24% and 21%, respectively, in 2019, according to Cotality. More than 22 million U.S. households are now considered rent-burdened — spending over 30% of income on housing — a new record, according to Apartment List, which found 52% of renters nationwide are cost-burdened.

The squeeze is compounded by financing costs: the average 30-year fixed mortgage rate has climbed past 7.5%, pushing the monthly payment on a median-priced $450,000 home up roughly $300 since earlier this year, according to Mortgage News Daily. Existing home sales in August fell to an annualized rate below 4 million. In Pennsylvania's Lehigh Valley, a swing congressional district, a household needs $67,481 a year — a "housing wage" of $32.44 an hour — to afford a typical two-bedroom rental without exceeding 30% of income, according to the National Low Income Housing Coalition.