In recent years, soaring rents in the United States have led to a growing number of Americans ending up homeless, according to a report released by Harvard's Joint Center for Housing Studies. The report reveals that approximately 653,000 individuals reported experiencing homelessness in January of 2023, marking a 12% increase from the same time a year earlier and a staggering 48% increase since 2015. This surge in homelessness represents the largest single-year increase in the country's unhoused population on record, highlighting the severity of the issue.

Traditionally, homelessness has been a prevalent problem in states like California and Washington. However, the report also highlights that historically more affordable regions of the country, such as Arizona, Ohio, Tennessee, and Texas, have seen significant growth in their unsheltered populations due to rising local housing costs. This alarming trend has been exacerbated by blistering inflation in 2021 and 2022, as well as surging rental prices across the nation that have outpaced worker wage gains.

While various factors can contribute to homelessness, the Harvard researchers found that high rents and the expiration of pandemic relief measures last year played a significant role in the spike in housing insecurity. The report states, "In the first years of the pandemic, renter protections, income supports, and housing assistance helped prevent a substantial rise in homelessness. However, many of these protections ended in 2022, at a time when rents were rapidly increasing and more migrants were unable to work. As a result, the number of people experiencing homelessness jumped by nearly 71,000 in just one year."

Analyzing Census and real estate data, the researchers discovered that rent in the U.S. has steadily climbed since 2001. It was found that half of all U.S. households, across income levels, spent between 30% and 50% of their monthly earnings on housing in 2022, rendering them "cost-burdened." Shockingly, approximately 12 million tenants were severely cost-burdened, meaning they spent over half of their monthly income on rent and utilities, representing a 14% increase compared to pre-pandemic levels.

Those earning between $45,000 and $74,999 per year were hit the hardest by rising rents, with an average of 41% of their wages going towards rent and utilities, according to the Joint Center for Housing Studies. The U.S. Department of Housing and Urban Development recommends that tenants allocate no more than 30% of their income towards rent.

Although there are some indications of the rental market cooling down, the median rent in the U.S. reached $1,964 in December 2023 – a 23% increase from pre-pandemic levels, as reported by online housing marketplace Rent. Comparatively, government data shows that inflation-adjusted weekly earnings for the median worker only rose by 1.7% between 2019 and 2023.

The Harvard report emphasizes that "rapidly rising rents, combined with wage losses in the early stages of the pandemic, have highlighted the inadequacy of the existing housing safety net, especially in times of crisis." The escalation in homelessness underscores the urgent need for improved affordable housing solutions and policies to address the growing housing crisis in the United States.