{"id":505104,"date":"2024-09-16T06:00:00","date_gmt":"2024-09-16T10:00:00","guid":{"rendered":"https:\/\/www.rent.com\/research\/?p=505104"},"modified":"2024-09-12T19:52:03","modified_gmt":"2024-09-12T23:52:03","slug":"houston-tx-college-grad-affordability","status":"publish","type":"post","link":"https:\/\/www.rent.com\/research\/houston-tx-college-grad-affordability\/","title":{"rendered":"Houston Is the Most Affordable Metro for Recent College Graduates Looking to Rent"},"content":{"rendered":"\n<h3 class=\"wp-block-heading\">Recent college grads have to pay just 27% of their income to afford a typical one-bedroom apartment in Houston \u2013 the lowest share in the nation&nbsp;<\/h3>\n\n\n\n<p>Recent college graduates have a lot to look forward to. Their future lies ahead of them as they hunt for a dream job and search for a great place to live in a new city. Unfortunately, that last part can be a sticking point.&nbsp;<\/p>\n\n\n\n<p>As rents have <a href=\"https:\/\/www.axios.com\/2024\/06\/21\/high-rent-inflation-pandemic-market-relief\" rel=\"nofollow\">skyrocketed<\/a> since the pandemic, college graduates have had a <a href=\"https:\/\/www.wsj.com\/articles\/the-biggest-problem-for-recent-college-grads-a-surge-in-rent-prices-11652385510\">harder time<\/a> finding an affordable place to live. But not in Houston, where recent grads have to spend less than 30% of their income on rent.&nbsp;<\/p>\n\n\n\n<p>So what\u2019s happening in the rental market? Why is Houston affordable for recent college graduates? Read on to learn everything you need to know.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Recent graduates in Houston have to pay just 27% of their income on rent to live alone<\/h2>\n\n\n\n<p>Recent college graduates have to spend 27.0% of their income to afford a one-bedroom apartment (\u201clive alone\u201d) in Houston, TX. This is the lowest share in the nation. Affordability has even improved slightly since 2019, when a graduate needed to spend 28.5% of their income on rent.&nbsp;<\/p>\n\n\n\n<p>Houston is just one of four metros in the dataset where recent college grads don\u2019t have to be \u201c<a href=\"https:\/\/www.huduser.gov\/portal\/pdredge\/pdr_edge_featd_article_092214.html\">rent-burdened<\/a>,\u201d i.e. spend more than 30% of their income on housing.&nbsp;<\/p>\n\n\n\n<p><strong>Houston is affordable because of its very low asking rents and moderate median salary<\/strong>. The median rent in Houston is the lowest among analyzed metros, sitting at $1,142, and the median salary is $60,277, level with the national median.<\/p>\n\n\n\n<p>Houston\u2019s affordability gets even better when looking at renting with a roommate (i.e. renting a two-bedroom apartment), where the typical grad needs to spend just 17.2% of their income on rent.&nbsp;<\/p>\n\n\n\n<p>However, even though Houston is affordable for recent college graduates, a large percentage of the city\u2019s overall population can\u2019t afford a median-priced apartment. Houston has the <a href=\"https:\/\/www.houstonchronicle.com\/news\/houston-texas\/census\/article\/houston-poverty-rate-increase-18365435.php\" rel=\"nofollow\">highest poverty rate<\/a> in the U.S. among large metropolitan areas, and more than <a href=\"https:\/\/www.understandinghouston.org\/topic\/economic-opportunity\/poverty-social-mobility\">one million residents<\/a> can\u2019t afford basic necessities. Over 50% of the total renter population is rent burdened, on par with the <a href=\"https:\/\/www.jchs.harvard.edu\/sites\/default\/files\/reports\/files\/Harvard_JCHS_Americas_Rental_Housing_2024.pdf\">national average<\/a>.\u00a0<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Nationwide recent college graduate rental affordability<\/h2>\n\n\n\n<p>Nationwide, recent college grads have to pay 35.7% of their income to afford a one-bedroom apartment. This is down from 39% in 2023, underscoring how rents have stabilized and wages have increased in the past year. Let\u2019s dig a bit deeper.<\/p>\n\n\n\n<p>Generally, asking rents have <a href=\"https:\/\/www.redfin.com\/news\/redfin-rental-report-january-2024\/\">held steady<\/a> since late 2023, due to a <a href=\"https:\/\/www.redfin.com\/news\/redfin-rental-report-march-2024\/\">surge<\/a> of new construction buoying supply and <a href=\"https:\/\/www.redfin.com\/news\/housing-migration-trends-november-2023\/\">waning<\/a> pandemic-era migration hampering demand. This is a major reason why most metros became more affordable for recent college grads in the past year. An <a href=\"https:\/\/www.brookings.edu\/articles\/we-should-focus-on-rising-wages-not-just-inflated-prices\/\">increase<\/a> in wages, <a href=\"https:\/\/www.epi.org\/publication\/swa-wages-2023\/\">especially<\/a> among low-income groups, has also helped improve affordability \u2013 even <a href=\"https:\/\/www.bankrate.com\/banking\/federal-reserve\/wage-to-inflation-index\/\">outpacing<\/a> historic inflation.&nbsp;<\/p>\n\n\n\n<p>However, even though new apartment construction has helped satiate demand, much of it has been catered to higher-income renters. From 2012-2022, an additional 8.4 million units rented for more than $1,400\/month, compared to a <em>decrease<\/em> of 2.1 million units renting for less than $600\/month. $1,400\/month is an unaffordable rent for a <a href=\"https:\/\/www.npr.org\/2024\/01\/25\/1225957874\/housing-unaffordable-for-record-half-all-u-s-renters-study-finds\">majority of Americans<\/a>. And while wages have risen faster than inflation, rents climbed <a href=\"https:\/\/www.bloomberg.com\/news\/articles\/2024-05-07\/us-rents-climbed-1-5-times-faster-than-wages-in-last-four-years\">even faster<\/a> in large metros from 2019-2023, seriously straining budgets.&nbsp;<\/p>\n\n\n\n<p>Even still, America\u2019s renter population is growing three-times faster than its homeowner population, in part because house prices are at record highs. <a href=\"https:\/\/www.redfin.com\/news\/renters-becoming-homeowners-2024\/\">Nearly 40%<\/a> of U.S. renters don\u2019t believe they\u2019ll ever own a home. Mortgage rates <a href=\"https:\/\/www.redfin.com\/blog\/is-now-a-good-time-to-buy-a-house\/\">have been falling<\/a> recently, though, providing a glimmer of hope.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Metro-level highlights&nbsp;<\/h2>\n\n\n\n<p>Nationwide, 29 out of the 33 metros analyzed require recent college graduates to spend more than 30% of their income on rent for a one-bedroom apartment. The four most expensive are <a href=\"https:\/\/www.rent.com\/new-york\/new-york\/apartments_townhouses_condos_houses\">New York<\/a> (56.3%), <a href=\"https:\/\/www.rent.com\/california\/los-angeles\/apartments_townhouses_condos_houses\">Los Angeles<\/a> (54.9%), <a href=\"https:\/\/www.rent.com\/massachusetts\/boston\/apartments_townhouses_condos_houses\">Boston<\/a> (54.8%), and <a href=\"https:\/\/www.rent.com\/california\/riverside\/apartments_townhouses_condos_houses\">Riverside<\/a> (53.7%).&nbsp;<\/p>\n\n\n\n<p>These trends flip when looking at two-bedroom apartments: 27 out of 33 metros are <em>affordable <\/em>to recent grads, with just the most expensive coastal metros requiring more than 30% of a grad\u2019s income.<\/p>\n\n\n\n<p>One of the most interesting metros in the dataset is Austin, which went from unaffordable (35.2%) to affordable (28.3%) in one year. This makes sense; Austin was the poster child for booming metros during the pandemic, seeing <a href=\"https:\/\/www.redfin.com\/news\/q4-2020-housing-migration-trends\/\">a huge surge in migration<\/a> from 2020 to mid-2022. This flood of new money and demand led to <a href=\"https:\/\/www.newsweek.com\/austin-housing-market-sinking-1843057\">skyrocketing housing costs<\/a>, large inflation increases, and a <a href=\"https:\/\/www.redfin.com\/news\/america-building-fewer-apartments-2024\/\">surge in new construction<\/a>. However, once the sharp interest rate hikes and return-to-office mandates started in 2023, the city\u2019s fortunes reversed, leading to price drops and <a href=\"https:\/\/www.redfin.com\/news\/housing-migration-trends-q3-2023\/\">population loss<\/a>. Now, some property managers are <a href=\"https:\/\/www.redfin.com\/news\/rents-fall-in-florida-austin-june-2024\/\">having to compete<\/a> for tenants.<\/p>\n\n\n\n<p>San Jose is also surprisingly affordable to new grads, despite having the highest rents in the country. This is because a lot of recent grads in the Bay Area are working high-paid Silicon Valley tech jobs, making <a href=\"https:\/\/sanjosespotlight.com\/san-jose-leads-nation-in-hiring-new-college-grads\/\">six-figures<\/a> right out of college. The median salary for recent grads in San Jose is $108,449, for example.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">10 Most Affordable Metros for Recent College Graduates<\/h2>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td><strong>Metro<\/strong><\/td><td><strong>2024: Share of income college grads need to spend for 0-1 bedroom apartment<\/strong><\/td><td><strong>2023: Share of income college grads need to spend for 0-1 bedroom apartment<\/strong><\/td><td><strong>2024: Share of income college grads need to spend for 2 bedroom apartment<\/strong><\/td><td><strong>2023: Share of income college grads need to spend for 2 bedroom apartment<\/strong><\/td><td><strong>Estimated median salary of recent college grads<\/strong><\/td><td><strong>Median asking rent: 0-1 bedrooms<\/strong><\/td><td><strong>Median asking rent: 2 bedrooms<\/strong><\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/texas\/houston\/apartments_townhouses_condos_houses\">Houston, TX<\/a><\/td><td>27.0%<\/td><td>25.2%<\/td><td>17.2%<\/td><td>17.5%<\/td><td>$60,277<\/td><td>$1,142<\/td><td>$1,449<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/michigan\/detroit\/apartments_townhouses_condos_houses\">Detroit, MI<\/a><\/td><td>27.8%<\/td><td>28.9%<\/td><td>17.3%<\/td><td>19.2%<\/td><td>$60,277<\/td><td>$1,193<\/td><td>$1,148<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/texas\/austin\/apartments_townhouses_condos_houses\">Austin, TX<\/a><\/td><td>28.3%<\/td><td>35.2%<\/td><td>17.2%<\/td><td>21.2%<\/td><td>$62,688<\/td><td>$1,310<\/td><td>$1,595<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/ohio\/cincinnati\/apartments_townhouses_condos_houses\">Cincinnati, OH<\/a><\/td><td>29.9%<\/td><td>28.9%<\/td><td>16.9%<\/td><td>16.9%<\/td><td>$59,071<\/td><td>$1,240<\/td><td>$1,400<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/texas\/dallas\/apartments_townhouses_condos_houses\">Dallas, TX<\/a><\/td><td>30.5%<\/td><td>35.4%<\/td><td>19.3%<\/td><td>22.6%<\/td><td>$66,305<\/td><td>$1,347<\/td><td>$1,707<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/north-carolina\/charlotte\/apartments_townhouses_condos_houses\">Charlotte, NC<\/a><\/td><td>32.5%<\/td><td>37.5%<\/td><td>18.7%<\/td><td>21.9%<\/td><td>$57,866<\/td><td>$1,371<\/td><td>$1,580<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/arizona\/phoenix\/apartments_townhouses_condos_houses\">Phoenix, AZ<\/a><\/td><td>32.9%<\/td><td>38.0%<\/td><td>19.8%<\/td><td>22.9%<\/td><td>$56,660<\/td><td>$1,369<\/td><td>$1,647<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/indiana\/indianapolis\/apartments_townhouses_condos_houses\">Indianapolis, IN<\/a><\/td><td>33.4%<\/td><td>34.6%<\/td><td>18.5%<\/td><td>21.4%<\/td><td>$54,249<\/td><td>$1,317<\/td><td>$1,460<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/georgia\/atlanta\/apartments_townhouses_condos_houses\">Atlanta, GA<\/a><\/td><td>33.4%<\/td><td>38.0%<\/td><td>19.6%<\/td><td>21.2%<\/td><td>$60,277<\/td><td>$1,416<\/td><td>$1,663<\/td><\/tr><tr><td><a href=\"https:\/\/www.rent.com\/florida\/jacksonville\/apartments_townhouses_condos_houses\">Jacksonville, FL<\/a><\/td><td>34.0%<\/td><td>45.8%<\/td><td>20.0%<\/td><td>25.5%<\/td><td>$54,249<\/td><td>$1,293<\/td><td>$1,524<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p>Table sorted by average share of 0-1 bedroom rentals affordable to recent college graduates<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Methodology<\/h2>\n\n\n\n<p>According to a <a href=\"https:\/\/www.redfin.com\/news\/college-grad-rent-burden-2024\/\">Redfin analysis<\/a> analyzing rents in apartments with five or more units from Redfin.com and Rent.com through July 2024 among the 33 most populous U.S. metros. The analysis estimated 2024 salaries for employed college graduates aged 22-29 (\u201crecent college grads\u201d) using U.S. Census Bureau\u2019s 2022 American Community Survey data and 2023-2024 wage growth data from the Atlanta Federal Reserve. To be included, a grad must have had an annual income of at least $15,000 at the time of the survey.&nbsp;<\/p>\n\n\n\n<p>An \u201caffordable\u201d rental is defined as one where the asking rent is no more than 30% of the local estimated income for recent college grads. Graduates who rent apartments above the 30% cutoff are considered \u201crent burdened.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The typical recent college grad has to spend over 30% of their income on rent. In Houston, the amount recent grads need to spend falls to just 27%. Why is the area so affordable? <\/p>\n","protected":false},"author":1022,"featured_media":505105,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19835,19832,19828],"tags":[],"topics":[195,202],"renters":[],"cities":[],"propertymanagement":[],"class_list":["post-505104","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industry-trends","category-renting-trends","category-research","topics-data-research","topics-news-trends"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v21.1 (Yoast SEO v24.9) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Houston Is Affordable for Recent College Grads | Rent. Research<\/title>\n<meta name=\"description\" content=\"The typical recent college grad has to spend over 30% of their income on rent. But in Houston, the share is just 27%. 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