Housing Costs Decrease for Owners, Increase for Renters

Housing costs have decreased for owners, but increased for renters, according to the Pennsylvania Housing Finance Agency’s 2023 Pennsylvania Comprehensive Housing Study.

Housing Prices

In 2022, 17,000 new single-family homes were constructed in the New England region, with 44% having a contract price of $500,000 or above. The share of new homes with contract prices above $500,000 has steadily increased since 2002 (4%) and significantly jumped since 2019 (25%). In comparison, the share of units in every price range below $200,000 has decreased since 2002.

While new homes are increasing in price, values for all homes are also increasing. In 2021, the median home was valued at $241,000, compared to $180,366 in 2015, adjusted for inflation.

According to PAR’s housing market report, the median price of homes in 2017 was $140,000, compared to $213,699 in 2023.

Growth in the value of homes especially grew between January 2020 and January 2023, increasing by 35% to $254,753.

In Pennsylvania, prices rose 26% from January 2020 and January 2023 to $195,123.

As of 2022, homeowners had slightly lower inflation-adjusted monthly housing costs ($1,150) than in 2010 ($1,181). Housing costs consumed 15% of household income for the median owner-occupant household.

Rents

Median gross rent in 2022 was $1,116, compared to $1,036 (adjusted for inflation). Data suggests renters looking for apartments today are finding even higher median rents. In January 2024, the median rent was $1,251.

The study notes that the supply of low-cost rental units is shrinking proportionally to the supply of rental units. In recent years, rents have increased most for efficiency and five-plus-bedroom units, and rents consume a larger share of households’ incomes. Gross rent has wavered at around 29-30% of the median renter household’s income between 2010 and 2022. This makes renting in Pennsylvania on the verge of unaffordable. Affordable housing is commonly defined as consuming no more than 30% of a household’s income.

Learn  more details about housing and renting costs by reading the PHFA’s full report.