Low-income Americans are skipping meals and selling belongings to afford housing

Housing costs are the biggest expense for many Americans. With prices rising rapidly, it’s no surprise that lower-income earners are finding it harder to keep up.

In October 2024, shelter costs increased by 4.9% compared to the previous year, based on data from the Consumer Price Index.

As a result, 74% of Americans making under $50,000 a year regularly struggle to pay their rent or mortgage, according to a recent Redfin report.

What’s alarming is the sacrifices people are making to afford housing. Around 24% of those earning less than $50,000 annually have skipped meals to cover housing expenses. Another 23% have sold their possessions.

Additionally, 21% of lower earners have put off or skipped medical treatments to save money, which suggests the high cost of housing is affecting their health.

If you’re struggling with housing expenses, there are steps you can take to ease the burden before it impacts your well-being.

Why is housing so expensive?

Since the pandemic, buying a home has become increasingly unaffordable. In early 2020, the median U.S. home price was $329,000. It peaked at $442,600 in late 2022 and now stands at $420,400 as of the third quarter of 2024.

During the pandemic, mortgage rates hit record lows, boosting buyer demand and driving up home prices. Later, as rates increased, homeowners held onto their low-interest mortgages, leading to a supply shortage.

In October 2024, the national housing supply was at 4.2 months, according to the National Association of REALTORS. This is better than the previous year but still below the six-month supply needed to balance demand and prices.

Meanwhile, high homeownership costs have pushed more people into the rental market, increasing demand and allowing landlords to raise rents.

Inflation has also raised the costs of property maintenance and utilities, which landlords are passing on to tenants through rent hikes.

How to lower housing costs

The median U.S. income is $1,165 per week, or about $60,580 annually. Many earning under $50,000 are not far off from the average salary, but those on the lower end may struggle more.

If your income is too high for government aid, negotiating your rent might help. Long-term tenants in good standing can ask for a reduction, as landlords prefer stability over vacancies or unreliable tenants.

Homeowners can speak with their lenders about modifying mortgage terms. Extending repayment periods can lower monthly payments.

If you have equity, selling your home and downsizing could lower your expenses. However, if you owe more than your home is worth, mortgage forbearance might provide temporary relief.

If downsizing isn’t an option and negotiating doesn’t work, taking on extra work or side gigs might be the best way to increase income.

Redfin reports that 21% of those earning under $50,000 have already done this to afford housing. This could be a good temporary solution until mortgage rates drop, making refinancing an option to secure lower monthly payments.