50% of US renters spend half their income on rent and utilities, study finds. But there’s some hope for Jacksonville

If you feel like housing is unaffordable, you are not alone.

A new study from Harvard University found that a record half of all US renters spent more than half their income on rent and utilities in 2022.

The study found a scarcity of affordable housing to this date, but there is a glimmer of hope for Northeast Florida.

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News4JAX wanted to find out how Northeast Florida’s rental prices compared with the rest of the country after Harvard released its study and found that Jacksonville’s average rent is trending downward. But it still doesn’t spell relief for people already paying exorbitantly high prices.

Renter Manny McElroy said Floridians are struggling.

It’s a sentiment he and other renters across the country are experiencing after digging deep into their wallets to pay for their monthly rent. According to the Harvard study, 12 million Americans spent over half their paychecks on rent and utilities which put them into the financial category that researchers call “severely cost-burdened.”

McElroy said his rent keeps increasing.

″They go up like 25 [percent], for some people 75,” he said.

Hope however could be on the horizon for the state of Florida, and specifically Jacksonville with newly released data from economists at Florida Atlantic University (FAU).

FAU Real Estate Economist Ken H. Johnson said despite the national numbers, data from Jacksonville shows that rent prices are either leveling off or declining — just a bit.

“We’ve come down to a point where the average rent in Jacksonville is just over $1,700 per unit to avoid being house poor, or rent burdened, as defined by the Department of Housing and Urban Development, HUD,” Johnson said.

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Researchers at FAU said that based on their calculations the average rent right now for Jacksonville tenants is $1713.70 per unit. Compare that to the average price for rent across the country which is $2,000 per unit, according to Zillow.

The experts said there are several reasons why rent prices skyrocketed over the past two years.

“The demand to live in Florida, which is in part driven in part by COVID. The high interest rates right now are stopping people from forming those first household ownerships. So, there are a lot of people that are saying I just don’t want to borrow money at six and a half or seven and a half percent, especially in light of the fact that I keep hearing that interest rates, mortgage rates should be coming down in the next year or two,” Johnson said.

Johnson said according to his researchers’ latest data, the income needed to avoid being rent-burdened is an annual income per household of $68,500 in Jacksonville.

While news of the price of rent leveling off is encouraging to some, economists said the only real trigger to make rental prices drop substantially is if builders overdevelop more Florida communities.

“That’s probably the only way that we’ll see significant drops in rent is that they literally have to over-develop, not by a little, but a lot, and then we’re going to start to see some pretty good multifamily apartment deals that would be out there,” Johnson said.

As for that report from Harvard, it doesn’t make any specific forecasts about the high price of rent, but there’s little expectation that rents will drop or that the overall housing market will suddenly transform into being affordable.

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