Out of Reach 2025: The High Cost of Housing

"Affordable, decent-quality housing remains out of reach for many of the nation’s lowest-income renters. Despite modest economic gains for lower-income households in recent years, the rental housing crisis persists. Half of all renter households are now housing cost-burdened, paying more than 30% of their income on rent and utilities, and over a quarter are severely housing cost burdened, spending more than half of their income (NLIHC, 2025). These cost burdens disproportionately impact the lowest-income renters.

Amidst ongoing economic uncertainty, incomes are struggling to keep pace with rents. At the same time, housing assistance remains deeply underfunded, and a severe shortage of affordable homes continues to push renters into unstable and uncertain living situations. Addressing these challenges will require sustained investment in affordable housing programs and other reforms.

From 2022 through the end of 2024, the U.S. experienced a period of economic growth. This growth included improvements in the labor market, with rising wages especially among workers in the bottom 10th percentile (Gould & DeCourcy, 2024). There was also some relief in the rental market: median rents declined by 3.5% from their peak in August 2022 (Apartment List, 2025). However, significant challenges persist in the housing sector. The post-pandemic construction boom has slowed and building costs have continued to rise—materials costs alone have increased 34% since 2020 (NAHB, 2025).

After a sustained period of growth, Gross Domestic Product (GDP) contracted 0.2% in the first quarter of 2025, signaling rising economic uncertainty. Any further economic decline this year could deepen the housing crisis for renters through income loss and greater financial strain. However, even if the economy avoids a downturn, renters will continue to face significant challenges in securing and affording stable housing. In the face of this uncertainty, the urgent need for housing assistance remains as critical as ever.

For more than 30 years, the National Low Income Housing Coalition’s (NLIHC) Out of Reach report has documented the gap between wages and rental housing costs in the U.S. Each year, the report shows that affordable rental homes remain out of reach for millions of low-wage workers, families, and other renters. The report’s signature statistic, the “Housing Wage,” estimates the hourly wage a full-time worker must earn to afford a modest rental home at the U.S. Department of Housing and Urban Development’s (HUD) Fair Market Rent, without spending more than 30% of their income. Fair Market Rents estimate what a household moving today could expect to pay for a modest, decent-quality rental home—not luxury housing. Yet for many renters, even these homes are priced beyond reach.

In 2025, the national Housing Wage is $33.63 per hour for a modest two-bedroom rental home and $28.17 for a modest one-bedroom..."

Read the full report here: https://nlihc.org/sites/default/files/oor/2025_OOR_FullReport.pdf