Housing Cost Burden

How are we doing?

The percentage of households that were housing cost burdened across the 12 Metropolitan Statistical Areas (MSAs) varied widely in 2018. Tucson ranked fifth lowest among peer metropolitan areas in the percent of households that were cost burdened. Housing cost burden ranged from 44.2% of households in San Diego to 28.1% in Salt Lake City. The Tucson MSA fared reasonably well, with only 33.0% or 128,147 households paying more than 30% of their income in housing costs.  Renters pay substantially more of their income in housing costs than do homeowners in Tucson, Arizona, and the U.S. Renters have experienced an increasing percentage of their income going to housing costs since 2000.      

Why is it important?

Historically, housing expenditures (including utilities) for both homeowners and renters that exceed 30 percent of a household’s income are considered cost burdened, this designation evolved from the United States National Housing Act of 1937. Households that are cost burdened are more likely to struggle to pay for other basic needs such as healthcare, childcare, transportation, and even food. 

How do we compare?

When comparing household tenure, renters are more likely than owners to be cost burdened.  In the Tucson MSA during 2018, 22.4% of owners and 51.8% of renters were housing cost burdened, this was consistent with the state and the nation.

Income levels play a significant role in determining the percentage of households that are housing cost burdened. As one would expect, households that have lower income are more likely to experience housing cost burden. In Tucson, of the households that earn less than $20,000, 43.4% of them pay more than 30% of their income in housing cost. This was significantly higher than those earning less than $20,000 throughout the state of Arizona and the nation which had housing cost burden rates closer to 36.0%. At the other end of the spectrum, of those that earned $75,000 or more only 3.3% were housing cost burdened in Tucson, while the rate increased slightly for the state to 4.8% and was nearly triple for the nation at 9.1%.

In 2018, those aged 25 to 34 posted the highest percentage of housing cost burdened households in Tucson at 23.0%, just behind those aged 65 and older that had a rate of 22.8%. For the U.S. and state of Arizona, the 65 and over age group had a higher rate of households that were housing cost burdened than did Tucson. However, those aged 25 to 34 had higher rates in Tucson when compared to their peers around the state and nation.

What are the key trends?

The rate of households that were considered housing cost burden rose substantially between 2000 and 2009 in Tucson, the state of Arizona, and the U.S. for renters. That increased leveled off for Tucson and the U.S. between 2009 and 2018, while the state of Arizona saw a slight decline. Tucson has consistently posted higher rates of housing cost burden for renters than both Arizona and the nation for the past nineteen years.

How is it measured?

Housing cost burden data are reported for homeowners that have a mortgage, homeowners that do not have a mortgage, and for renters. Housing cost burden reflects those households that pay greater than 30% of their income on housing costs, including utilities. Housing cost burden data are from the Census Bureau’s American Community Survey (ACS). The ACS is a nationwide rolling sample survey that produces one-year and five-year estimates on demographic, social, housing, and economic measures. All data provided in this analysis utilized five-year estimates. Note that the ACS five-year estimates are produced over a five year time period and can only be compared to non-overlapping five-year estimates (for example: 2005-2009 and 2010-2014).