When it comes to housing costs, a general financial rule says not to spend more than 30% of your pre-tax income on this inevitable expense. But though the Bureau of Labor Statistics says that Americans paid roughly 25% of their income on housing expenses in 2020, residents in larger cities generally have to put in more working hours to afford housing.
To understand the impact on residents in these cities, we examined the number of work hours required to cover housing costs and the factors that determine their differences. To determine our estimates, we considered data on the following metrics: average annual take-home pay, average hours worked per year and median monthly rent. For details on our data sources and how we put all the information together to create our final rankings, read the Data and Methodology section below.
This is SmartAsset’s fifth study on the hours of work needed to pay rent. Check out the previous version here.
- On average, 56 work hours are needed to afford rent across the largest 25 cities. Detroit, Michigan is the only city where a single full-time work week could pay for a month of rent. The median monthly rent in Detroit is $850 and the average employee earns about $20 per hour after taxes.
- Nearly 40 work hours separate the highest and lowest ranked cities. At the top of our list, the average worker in San Jose, California needs to put in 77.4 hours to pay rent. Meanwhile, in Detroit, Michigan, we estimate that 40.9 hours of work are needed to pay rent. For reference, the median monthly rent in San Jose ($2,232) is more than twice as high as rent in Detroit ($850).
1. San Jose, CA
Residents in San Jose, California need to put in the most hours to pay rent (77.4 hours, or nearly two weeks of full-time work). Census Bureau data shows that the median monthly rent in San Jose is $2,232 and the average annual take-home pay is only about $40,500.
2. Los Angeles, CA
In the largest California city, median earnings for a worker are just over $33,300. Average take-home pay after taxes is closer to $27,800 (or roughly $21 an hour). A worker in Los Angeles can expect to work about 72.3 hours to pay rent alone.
3. San Diego, CA
Nearly two hours away from Los Angeles is the second-most populous California city: San Diego. We found that workers in this city need to work 72.2 hours to pay a month's rent. Median earnings in San Diego is just about $41,600. Workers take-home $34,166 on average, which comes out to roughly $24.53 an hour.
4. Boston, MA
Boston, Massachusetts residents need to work 68.1 hours to pay rent, or roughly nine full-time days of work. Average take-home pay is $34,210 (which breaks down to $24.75 an hour) and the city's median monthly rent is $1,685.
5. San Francisco, CA
Renters in San Francisco, California can expect to work an average of roughly 63 hours to pay for housing in a given month. Of the cities included in this study, San Francisco has the highest average take-home pay of $50,104, which equates to about $32 per hour. However, rent prices are also high. The median monthly rent is $2,010, or $24,120 annually.
6. New York, NY
The City That Never Sleeps might accurately describe how much time workers need to pay rent: 61.0 hours. The median monthly rent in New York is $1,489. Annually, that figure adds up to more than $17,800. Median earnings in New York are $41,977. But in actuality, take-home pay is closer to $32,454 (or $24 per hour).
7. Denver, CO
In Denver, Colorado, the average worker earns $43,767 before tax. Workers can expect to take home $35,467, which breaks down to $23.21 an hour. Median rent in Denver costs roughly $1,400 per month, meaning that workers need to work roughly 60 hours to cover that expense alone.
8. Austin, TX
Workers in Austin, Texas need to work an average of 57.4 hours to pay rent. Median monthly rent is $1,346 (or $16,152 annually). Take-home pay in this city is $35,746, which works out to $23.44 an hour.
9. Charlotte, NC
In Charlotte, North Carolina, the median monthly rent is $1,185, or $14,220 annually. Workers here need to put in almost 57 hours of work, or just about seven days of full-time work, to pay for rent. The average take-home pay in Charlotte is $30,859, which breaks down to $20.83 per hour.
10. Seattle, WA
Average take-home pay in Seattle, WA is about $46,400, which works out to roughly $30 an hour. As the median monthly rent is $1,702, the typical worker will need to work 56.6 hours to afford a month's rent. This is equivalent to roughly seven days of full-time work.
Data and Methodology
To find out how many hours of work are needed to pay rent in the 25 largest cities in the U.S., we looked at data on the following three metrics:
- Average annual take-home pay. This is the average worker’s earnings after accounting for income taxes. To find out how much each worker would pay in income taxes, we ran median worker’s earnings data through our income tax calculator. We assumed the average worker would contribute nothing to an IRA or 401(k), take the standard deduction and file as a single filer. Earnings data comes from the U.S. Census Bureau’s 2020 5-year American Community Survey.
- Average hours worked per year. This is the number of weeks worked per year multiplied by the number of hours worked per week. Data comes from the U.S. Census Bureau’s 2020 5-year American Community Survey.
- Median monthly rent. Data comes from the U.S. Census Bureau’s 2020 5-year American Community Survey.
First, we found the average hourly wage for each worker by dividing average annual take-home pay by average hours worked per year. Then we divided the monthly median monthly rent by the average hourly wage. This resulted in the average hours of work needed to pay a month’s rent. Finally, we ordered the cities from highest to lowest based on the average number of hours needed to pay rent.
Tips for Managing Your Income
- Know how much you are working with. Seeing your salary on paper is one thing but understanding how much actually ends up in your bank account after taxes and retirement contributions is another. Using our paycheck calculator can help you visualize your take-home pay and make a plan for how best to spend it.
- Set up a budget. Juggling life’s expenses can be tricky, but you can gain financial control with budgeting. Our budget calculator can give you a clear picture of your current spending but also project the next six months and show you where cutting back on excess expenses can maximize your savings.
- Talk to an expert. A financial advisor could help you work smarter, not harder for your housing needs and goals. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
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