Market rent declined 0.9% in Q1 2023. 

While the rent-to-income (RTI) ratio is back below 30% in the U.S., a new report says residents should expect to spend one-third of their income on rent. According to the “U.S. State of Rent Burden” report from Moody’s Analytics, market rent declined 0.9% in the first quarter of 2023.

The RTI exceeded the 30% rent-burden threshold last year for the first time ever. RTI currently sits at 29.6%. “Moreover, with rent growth projected to hover at around 2% annually, the national rent-to-income ratio will stay mostly flat this year (29.7%) and halt any steeper downswing,” according to the report.

The most rent-burdened metros remained the same to start 2023—New York City, Miami, Fort Lauderdale, Fla., Los Angeles, Palm Beach, Fla., northern New Jersey, Boston, Tampa-St. Petersburg, Fla., Orlando, Fla., and San Francisco. There were 72 of the 79 metros that witnessed a decline from growing rent burdens in the first quarter. Rent declines were 85% of the reason those metros saw a dip in rent burdens while the other 11 metros had increases in income.

In 1999, New York at more than 53% was the only rent-burdened metro area in the U.S. In 2010, the number had reached four metros: Los Angeles, Miami and Boston joined New York. As of 2022, there are seven rent-burdened metros in the U.S. with LA the only non-East Coast metro.