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Rising rents offset modest income gains

Census data shows the best-ever numbers for income, poverty, and health insurance, but they’re no match for rising rents

Incomes are up, poverty is down, and more U.S. residents have health insurance than ever before, according to the most recent stats released by the U.S. Census Bureau. The numbers are so good, in fact, the chair of the White House’s Council of Economic Advisers didn’t hesitate to say it is "unambiguously the best Income, Poverty & Health Insurance report ever."

The poverty rate fell 1.2 percent and the number of uninsured people reached a record low of 9.1 percent, all while the country’s median household income rose 5.2 percent from 2014 to 2015.

However, much of the income increase came from urban areas where the income gains are largely offset by steeply rising rents. Between 2008 and 2014, an additional 3.6 million households joined the ranks of those cost-burdened housing. Housing is cost-burdened when a household is paying upwards of 30 percent of income on having a place to live. Anyone living in New York City, L.A., or another high-cost metro area might laugh at the idea that you could find housing for less.

Part of the problem is that the construction of new rental apartments doesn’t meet the population growth of new renters—especially in highly desirable urban areas. In 2015, rents rose in L.A. county by 8.3 percent, in San Francisco by 4.5 percent, and by double-digit increases across many of the country’s most desirable neighborhoods.