Renting Costs Continue to Rise: The rising cost of rent for city dwellers continues to increase, notable those local to Philadelphia

By: Hannah Bonanducci

In the wake of the COVID-19 pandemic and major shifts in administrations, many Americans have felt the strain of inflation reflected in the more expensive grocery trips and cost of gas. However, a concern that has been a problem since the start of the pandemic is the rising cost of living, specifically for those who rent. According to Economy League, as of 2022, the average cost of rent in the US stands at $1.9k per month. In Philadelphia, this number averages from $1.6k (City of Philadelphia) to $1.8k (Greater Philadelphia) per month, an 8-12% increase from the previous year.

While it isn’t unusual for rent to rise, the main problem at hand is the rate at which it is increasing. According to Economy League, before the pandemic, it would take two or more years for rent to increase by $100 per month, but from 2021 to 2022, it increased on average by about $197 per month. This might not be problematic if it was affordable, but the “rent burden” (how much of your paycheck goes towards rent) has increased from around 30% to 48.1%, leaving Philadelphia with the fifth highest proportion of rent burden in the US. And since Philadelphia doesn’t have a rent ceiling, we can only expect those numbers to increase for the worse.

The problem of rising rent is impacting low-income families the most, many of whom are disproportionately people of color. According to Bloomberg, these families make up the majority of the renting population in the US. This especially puts an extremely heavy burden on low-income families as they also try to balance rent on top of the rising cost of gas and groceries, leaving little to no room for emergency funds for those living paycheck to paycheck.

Around 50% of renters earn less than $50,000 per year, with the median income of a renter around $42,500, which is $25,000 below the national average according to Zillow. According to Project Home, in Philadelphia specifically, renting is difficult enough with the city’s 23% poverty rate combined with “only 37 affordable housing units for every 100 extremely low income households.”

Earlier this year, the Biden administration released the Housing Supply Action Plan, which hopes to combat the housing crisis by addressing the supply and demand issue believed to be behind the surge in rent costs. It is considered to be one of the most comprehensive plans in combating the housing supply shortfall, looking to finish building more homes than we’ve seen since 2006 by the end of 2022. President Biden also has set aside a portion of the 2023 budget to go towards producing or rehabilitating another 500,000 homes in the U.S.

While this is a response that has been applauded by many and is believed to address one of the driving factors of rent increase, many renters are calling on President Biden for more immediate assistance in the midst of the current housing crisis. According to the Washington Post,  recently, a coalition of tenant unions, community organizations and legal groups sent a set of proposals to the Biden administration asking them to declare a state of emergency on housing. In Philadelphia, the Philadelphia Tenants Union has called on the Philadelphia City Council for an immediate rent freeze and cap on future rent increases. 

Looking forward, the Point-in-Time Count (henceforth “Count”) is going to be one of the largest indicators of how big the renting crisis is and how it will be handled. The Count is one of the biggest data collections done by the US to survey the homeless population in discovering how large it is and what communities are most affected by it. However, due to complications with the pandemic, the Count has not been taken since 2020. This leaves uncertainty as to the growth of the homeless population through the pandemic, with a special focus on the unsheltered homeless population.

According to the National Alliance to End Homelessness, it is believed that the Count “will not be fully updated until late 2022 or early 2023,” which will most likely be one of the driving factors in rent reforms once the data is released. Until then, most reforms are currently looking to take a long-term approach, leaving many low-income Americans struggling under yet another price jump following the pandemic. 

Sources: Bloomberg, Economy League, National Alliance to End Homelessness, Philadelphia Tenants Union, The Washington Post, The White House