SEATTLE (1/5/15)--Higher costs and more people in the rental market pushed the total of rent paid in the United States to $441 billion in 2014.
Rent costs increased $20.6 billion, or 4.9% from 2013, with the average renter paying an extra $26 per month, according to the real estate site Zillow.
America's 41 million renters spent roughly double what Americans as a whole spent on new cars.
Rental prices have increased nearly twice as fast as income growth since 2000, said Skylar Olsen, Zillow economist (U.S. News and World Report Dec. 30).
This leads to a challenging market for home purchases, he said.
"You pair record-high rents with record-high student loan payments and you've got a one-two punch there," Olsen told U.S. News. "It'll be hard for many young Americans to save for down payments or retirement. This'll have implications for many years to come."
However, volatile rent increases and tightened availability may spur some to turn to the stability of a mortgage payment, noted Stan Humphries, Zillow chief economist (MarketWatch Dec. 30).
The share of vacant rentals fell to 7.4% in the third quarter, according to Census Bureau numbers, with the median rent for vacant units coming in at $756.
(Editor's note: This article first appeared in the Jan. 2 issue of News Now.)