The U.S. rental housing market has offered a clear window into broader economic pressures shaping household finances. Renting is no longer a short-term phase for many Americans; it has become a longer-term reality across generations. Rising housing costs, elevated interest rates, and persistent debt burdens are reshaping who rents, how long they rent, and the financial resilience of the rental population. For landlords, lenders, and housing stakeholders, understanding these shifts is essential not only for near-term risk management but also for anticipating how today’s renters will influence tomorrow’s housing demand.
A rental market increasingly defined by younger households
Younger Americans continue to dominate the rental landscape. More than half of U.S. renters are now under the age of 35, with Generation Z accounting for approximately one-third of the total rental population, according to Experian’s 2025 State of the Rental Housing Market report. While renting has always served as a starting point for younger households, the length of time spent renting is increasing. High home prices, ongoing student loan repayment obligations and mortgage rates that remain well above pre-2022 norms have delayed the transition to homeownership for many first-time buyers. As a result, renting has shifted from a temporary necessity to a longer-term financial strategy, often by default rather than by choice.
At the same time, renting is no longer confined to younger demographics. Business Insider reports that since 2023, the population of renters aged 44 and older has grown, reflecting a combination of affordability constraints and evolving lifestyle preferences.
Rent growth continues to outpace income
Affordability remains the defining challenge of the rental market. Experian data shows that average monthly rent has increased steadily over the past two years, rising from approximately $1,520 in early 2023 to roughly $1,760 by early 2025. Over the same period, the average renter’s income has stagnated or declined slightly, hovering near $51,600 annually. The combined effect of rising rents and softening income is a widening affordability gap. The national rent-to-income (RTI) ratio now averages 46.8%, far exceeding the 30% threshold commonly used to define housing affordability, according to Experian’s 2025 analysis.
Credit profiles reflect mounting financial pressure
As housing costs rise, renters’ financial health is increasingly under strain. Experian’s rental market insights indicate that more than half of renters now fall within Near Prime or Subprime credit tiers, representing a meaningful increase since 2023. This shift does not necessarily signal declining financial responsibility. Instead, it reflects younger and thinner credit files, higher overall debt balances, and sustained cost-of-living pressures. Experian also reports that renters paying more than $1,000 per month have experienced a double-digit increase in negative payment activity over the past two years.
Understanding payment priorities when budgets tighten
When households face financial strain, trade-offs become unavoidable. According to payment hierarchy data published by the Consumer Financial Protection Bureau (CFPB), renters tend to prioritize auto loans first, followed by personal loans and student loans. Rent payments and unsecured revolving credit, such as credit cards, often fall lower on the priority list. This dynamic helps explain why rent delinquencies can rise even among renters who remain current on other financial obligations.
Why Experian?
As the rental market evolves, having a clear, data-driven view of renter behavior is more critical than ever. Experian helps landlords, lenders, and housing stakeholders understand shifting demographics, affordability pressures, and payment priorities through trusted data and advanced analytics. With deeper insight into today’s renters, businesses can better manage risk, uncover opportunity, and prepare for what’s next in housing demand.
