Affordability Watch Q1 2023

By NAA Research |

| Updated

4 minute read

As the cost of living continues to rise, the affordability of housing has become a pressing concern for renters, housing providers and policymakers. To assess rental housing affordability at the market level, the National Apartment Association (NAA) analyzed rent-to-income (RTI) percentages, which are based on residential lease applicants from professionally managed properties screened by TransUnion’s Resident Screening platform. Our analysis aims to analyze the changes in rent-to-income ratios over in several major markets across the United States. This issue will primarily focus on the period from Q1 2021 to Q1 2023.

Rental Affordability in the U.S.

The U.S apartment market continued to show signs of slowing during Q1 2023. RealPage reported that average effective rents were up 6.4% year-over-year, which was down from the surging pace of 17.3% in Q1 2022. Annual absorption remained in the negative territory, registering a deficit of 177,000 units. Contrastingly, completions accelerated to an impressive 358,000 units. The occupancy rate marked a notable dip, plunging to 94.8%, the lowest in the past six years. As developers respond to the housing shortage and renter demand, the addition of new deliveries to the rental pool helped to balance   various markets and improve affordability. 

During the first quarter of 2023, U.S. renter households in professionally managed properties spent on average 32.8% of their income on rent. This marks a slight increase of 0.1 percentage points since Q1 2022, and a 0.3 percentage point increase from the previous quarter. Understandably, there was a broad variation in the share of income renters spent on rent at the market level. In this analysis, NAA explores the distribution of rent-to-income percentages across U.S. markets, focusing specifically on areas experiencing notable changes in affordability.

Explore Rent-to-Income Levels at the Market Level

Find out how much income renters in your market are spending towards rent using the table below. Simply click on a column to sort the results by highest or lowest amounts.

Spotlight Markets:

  • San Diego: San Diego has long faced a scarcity of housing, which has led to renters spending an average of 41.5% of their income on rent. One of the most significant obstacles to developing more housing in San Diego is the city's stringent zoning laws. Many neighborhoods are zoned exclusively for single-family homes, stifling the potential to address demand through high-density housing, which is evidently needed. In fact, according to CoStar Group, luxury apartment communities have been driving the market in the past year, in part due to affluent households relocating to San Diego. Although the demand for class A apartments in San Diego has been high, in 2022, the overall demand for apartments in the city moderated. This resulted in a decline in occupancy rates. Consequently, the effective annual rent growth in Q1 2023 reached the lowest level since Q1 2021 and registered a decline of 8.2 percentage points compared to the previous year.
  • Richmond: Rent-to-income ratios in Richmond have been on a consistent upward trend each quarter since Q1 2021. As of Q1 2023, RTI levels reached 38%. Richmond has seen a steady influx of new residents, drawn by its emerging job market and reputable universitiesbut it has struggled to expand housing stock at a pace that matches its growing population. In April, Richmond’s City Council declared a housing crisis due to rising rents and soaring home prices, leading to the allocation of $50 million over the next five years in the capital improvement plan for affordable housing. On an optimistic note, CoStar reported that in the past five years, Richmond’s inventory has expanded by 16%. As demand has returned to pre-pandemic levels, the increase in supply has caused the vacancy rate to rise. In Q1 2023, vacancy levels increased over two percentage points to 7.7%. At the same time, annual effective rent growth cooled to 3.5%, which is significantly lower than the 11.4% seen in Q1 2022. 
  • Wichita: In contrast, renting an apartment in Wichita has become relatively more affordable. Wichita's RTI ratio has fallen more than 8 percentage points since Q1 2021. By Q1 2023, the RTI ratio decreased to 28.6%, more than 4 percentage points lower than the national average. The improvement in affordability is attributed to a mix of higher supply and reduced renter demand. As a result, housing providers adjust their prices to attract renters, creating a competitive market. According to data from CoStar, the rental market has experienced consecutive periods of negative absorption since Q3 of 2022, while new apartment supply has been delivered to the market. Consequently, vacancy rates have gradually increased, reaching 6.8% by Q1 of 2023.


To effectively address the issue of housing affordability, it is crucial to implement housing policies that increase the availability of affordable homes. The rental market in the United States is a complex landscape, influenced by a myriad of factors including job growth, renter demand, new construction, and vacancy rates. Policymakers must have a comprehensive understanding of these dynamics to successfully tackle housing affordability challenges. By prioritizing initiatives that increase the supply of housing, markets can strive towards achieving balanced and sustainable growth in their rental markets, ensuring that housing remains accessible and affordable for individuals of all income levels.



1. Rent-to-income averages are based on approved residential lease applicants screened by TransUnion’s Resident Screening platform in Q1 2021 to Q1 2023. 

2. Market level analysis was conducted for markets which received over 1,000 applications.

Sources: NAA; TransUnion Rental Screening Solutions; RealPage; Costar Group