• U.S. median rent has risen from about $824 in 2008 to more than $1,300 in 2025. As rent has increased faster than wages, Americans are spending much more of their income on housing. On average, it now takes an entire week’s worth of pay to afford monthly rent.

It’s hard to imagine today, but about 17 years ago, rent for Americans was less than $1,000 per month. In 2008, the median rent was just $824 per month; today it’s more than $1,300—and many major metropolitan areas like New York City and Los Angeles dwarf that figure. Between 2022 and 2025 alone, rents jumped nearly 6%.

That also means Americans are spending much more of their monthly income on housing. Although it’s generally recommended not to spend more than a third of one’s income on housing, many Americans are shelling out much more than that. That’s largely due to rent prices rising faster than wage growth in the U.S.

A recent Self Financial analysis of housing data from the U.S. Census, Apartment List, Bureau of Labor Statistics, and the Federal Reserve illustrates how many hours worth of work Americans are spending on housing each month. 

On average, Americans need to work 38.3 hours to cover their monthly rent, which works out to the average work week. But there’s a decent spread on the number of work hours needed to pay for rent across the U.S. 

Vermont residents need to work 60.2 hours per month to meet the average monthly rental costs, the highest of any state, according to the Self Financial analysis. People living in South Dakota need just 27.6 hours to cover rent, placing them in the lowest spot. Unsurprisingly, New York City residents need to work the most hours to pay rent at 90.2 hours. 

These are the five U.S. states with the highest number of hours required to cover the average monthly rent: 

• Vermont: 60.2 hours
• Hawaii: 59.9 hours
• California: 52.4 hours
• New Jersey: 50.4 hours
• Maryland: 50.3 hours

And these are the five U.S. states with the fewest number of hours required to cover the average monthly rent: 

• Maine: 32.3 hours
• North Dakota: 32.2 hours
• Alabama: 31.4 hours
• Arkansas: 31.1 hours
• South Dakota: 27.6 hours

See the heat map below, which shows the number of hours required to cover the monthly rent in each state. To see the number of hours, hover over each state. Deeper red indicates a higher number of hours.

While this may appear to be a grim outlook for rental housing in the U.S., there is a small glimmer of hope. As of May, median U.S. asking rent had actually dropped about 1% year-over-year, according to Redfin. That’s because apartment construction is hovering near a 50-year high, Redfin economists said.

“Even though renter demand is strong, it’s not keeping pace with supply,” said Sheharyar Bokhari, Redfin senior economist. “Many units are sitting vacant for months, which means renters have power to negotiate concessions and landlords have less leeway to keep rents high.”

Meanwhile, it’s still much cheaper to rent than to buy a home in the U.S. thanks to sky-high mortgage rates nearing 7% and home prices that are 55% higher than at the beginning of 2020, according to the Case-Shiller U.S. National Home Price Index.

Take Austin, Texas, for example. “Many people in Austin are finding that it’s a lot cheaper to rent than buy,” Austin real-estate agent Andrew Vallejo recently told Fortune. “You could buy a home and have a monthly mortgage payment of $3,200, but the same home will rent for $1,900. Unless the buyer has a good amount of money for a down payment, renting is way less expensive.”

This story was originally featured on Fortune.com

• The housing market continues to struggle with nearly high mortgage rates and home prices, driven by years of undersupply and slow home construction. Builders face higher costs and labor shortages, and home price growth is expected to slow this year as sellers pull homes off the market.

If you thought the housing market was bad enough: Buckle up. 

Mortgage rates are still nearly 7% and home prices are 55% higher than they were at the beginning of 2020, according to the Case-Shiller U.S. National Home Price Index. 

Housing inventory is slightly rising overall, but it’s not doing so by nearly enough, a May report by the National Association of Realtors and Realtor.com shows. And an analyst note published this week by Oxford Economics said the housing market will continue to deteriorate this year. 

“The supply of existing homes for sale is approaching pre-pandemic levels as a combination of high prices, elevated mortgage rates, and concerns over the labor market keep buyers sidelined,” Oxford Economics analyst Matthew Martin wrote in a note titled Recession Monitor – Real test for economy is just beginning. “The new-home market is also being challenged, with builders continuing to offer incentives including price cuts in an effort to move unsold inventory.”

Oxford Economics researchers also noted sellers will have less ability to pass along price increases. In other words, sellers will keep pulling their homes off the market if they can’t get a sale price they think they deserve. 

Meanwhile, homebuilders will continue to face higher costs due to tariffs and a reduced labor force because of fewer immigrants and more deportations, according to Oxford Economics. This, in turn, will slow housing starts—a.k.a. new construction—which won’t help inventory levels. 

“A longstanding lack of inventory has supported both high prices and sluggish sales in the market for existing homes,” Daiwa Capital Markets analysts Lawrence Werther and Brendan Stuart wrote in a note published Wednesday. “Substantial improvement is unlikely to materialize in the near term until mortgage rates (and/or prices) ease, thereby mitigating the current affordability challenges faced by potential buyers.”

Affordability is also hurting builders, who have had to continue offering incentives and price cuts. 

“Multiple years of undersupply are driving the record high home price. Home construction continues to lag population growth,” Lawrence Yun, chief economist for the National Association of Realtors, said in a statement. “This is holding back first-time home buyers from entering the market.”

“We still don’t have an abundance of homes that are affordable to low- and moderate-income households, and the progress that we’ve seen is not happening everywhere,” Realtor.com Chief Economist Danielle Hale said in a statement. “It’s been concentrated in the Midwest and the South.”

However, that leads to one small silver lining predicted by Oxford Economics. Due to labor-market concerns and weak demand (thanks to currently high home prices and mortgage rates), they predict home price growth will slow and builders will limit new-home construction.  

“Slower home price growth may provide a floor beneath sales,” Martin wrote, but “household appetites for spending will largely hinge on the health of the labor market.”

Despite a struggling housing market, Oxford Economics predicts the U.S. will avoid a recession this year and the Federal Reserve will start to “cut rates aggressively” at the beginning of 2026. 

This story was originally featured on Fortune.com

© Getty Images

• High home prices and mortgage rates have made the housing market especially tough for millennials, leaving many priced out of buying larger or new homes. As a result, a growing number of homeowners are opting to renovate by tapping home equity to stay put. This shift reflects the new reality where renovating for function and value, rather than moving, is becoming the norm among younger generations.

No matter which way you slice it, the housing market is challenging for just about everyone right now. Mortgage rates nearing 7% and elevated home prices have kept buyers out of the market. Sellers have gotten fed up with not getting the offers they think they deserve. 

That’s been especially tough for millennials who are growing out of their first homes. In many markets across the U.S., some smaller or starter homes are selling at or near $1 million—which prices the vast majority of younger buyers out.

But instead of dwelling on the fact they can’t afford their dream home, many current home owners are turning to renovations instead to add that idealistic kitchen or extra bathroom they would’ve wanted in a newer, larger home. Results from a June survey by This Old House, a home improvement brand, shows 60% of millennial homeowners and 56% of Gen Z homeowners have remodeling or renovation plans this year. 

In the real estate industry, it’s generally agreed upon that renovating a current home can typically be cheaper than building a new home from scratch or buying a larger existing home—although there are always individual factors at play that can impact a homeowner’s decision. But according to renovations marketplace Realm, it’s $49,000 cheaper on average to renovate an existing home and $79,000 cheaper to expand it than to buy a new one. Realm, which was founded in 2019, is responsible for about $200 million worth of projects each year, mostly in California and Seattle.

Why homeowners are staying in place

This staying-in-place phenomenon is caused by four main factors, Liz Young, founder and CEO of Realm, told Fortune. The first is current homeowners don’t want to sell their properties and re-enter a housing market that has mortgage rates much higher than the sub-3% rates of the pandemic era. Second, there is very high home equity in the U.S. Many homeowners tap into this home equity through a home equity line of credit (HELOC) for home renovations. This is also an appealing option because even if the home renovations are expensive, they’re being financed through a HELOC at more manageable monthly payments. 

Next is that we have an aging U.S. population who are staying in their homes for longer, and finally, new zoning rules have made it easier for homeowners to add on to their current homes or even build accessory dwelling units (ADUs) for family members or for use as a rental property.

“If you live in an area where the price per square foot to purchase a home is high, you could almost always add space and significantly increase your home value in doing so,” Young said. “There’s just no incentive right now for a consumer to leave their home and disrupt that low [mortgage] rate.”

Courtesy of Realm

Courtesy of Realm

Home renovation trends

Young said they’re seeing homeowners approach adding space to a home in three ways: adding to their primary residence, building ADUs, and converting unused space to make it functional. This would include additions such as an extra bathroom or bedroom or converting a garage, a shed, or basement for livable space for a family member or a tenant.

Because renovations can be disruptive, Young said homeowners are also prioritizing getting multiple renovation projects done at once. 

“If you’ve ever gone through a renovation, the reality is they are disruptive,” Young said. “Because people could tap into home equity to fund these projects, we’re really seeing them do multiple things at the same time.”

Kitchen renovations are one of the most popular choices among homeowners, Young said, as well as larger-scale outdoor projects. 

“With the pandemic, people got used to entertaining and hanging out outside. This is just an extension of our living area,” she said. “We’re seeing people look to have a fluid indoor-outdoor living setup where you’re able to transition seamlessly from entertaining or hanging out inside as well as outside.” This could include projects like hardscaping, outdoor kitchens, pools, and poolhouses. Outdoor living rooms are also popular.

The trends in home renovations also ultimately show how the American dream has changed. 

“The big thing that we’ve seen change is this idea of buying your dream home out of the gate,” Young said. “If I rewind the clock 15 years ago, people had these big ambitions or dreams of like, ‘Oh, I’m going to buy this amazing house and it’s going to be perfect.’ And for millennials—myself included—that’s just not the reality. There’s not enough housing inventory.”

This story was originally featured on Fortune.com

© Courtesy of Realm

• Sentiment toward college is shifting as Gen Z questions rising tuition costs, overwhelming student debt, and an unpredictable job market. A ResumeGenius survey shows that one in four Gen Zers regret going to college or wish they had pursued more lucrative fields, with only a third content with their educational choices.

The sentiment about going to college is changing, career counseling experts say. It used to be seen as a one-way ticket to a career and eventual financial stability, but mounting student loan debt and a shaky job market have turned earning a college degree into more of a question than a given. 

“Many older generations had the luxury of living in a market where their college degree was practically a get-a-job-free card after graduation,” Kolby Goodman, a career coach at Employed By Graduation, told Fortune. “Now, with more and more people pursuing higher education, fewer and fewer entry-level roles, and the breakneck speed of evolving technology, there’s a lot more uncertainty and lack of guarantees.”

ResumeGenius recently surveyed 1,000 full-time Gen Z workers across the U.S. on their views of college degrees and whether they’d choose a different career path. A lot of them wish they had made different choices, the survey revealed. About one in four said they regret going to college or wish they had chosen a higher-paying field like tech, finance, engineering, or health care. 

This report mirrors another survey conducted by career consultancy Tallo, which also recently surveyed more than 2,000 adults aged 18-30 about their career journeys and showed 62% of young adults said they aren’t in the career they intended to pursue. Some25% said they are actively struggling to find a job in their intended field.

“Many Gen Z students feel they were told college was the only path, only to see people with strong degrees underemployed or overlooked,” Tallo CEO Allison Danielsen told Fortune.  Plus, they’re “questioning whether college still delivers real value.”

The average cost of college in the U.S. is more than $38,000 per student per year, according to the Education Data Initiative; this means the average cost of college has more than doubled in the 21st century. Meanwhile, more than 4 million Gen Zers are jobless and blame their “worthless” college degrees.

The ResumeGenius survey showed only about a third of Gen Z workers were content in the choice they made about their education and wouldn’t change it. Even parents have started to recognize the fact the value of a college degree is changing. Another recent survey by American Student Assistance of more than 3,000 middle- and high-school students showed 70% of teens say their parents are more supportive of forgoing a college education for a different pursuit like trade school or an apprenticeship. 

“Parents are waking up. College doesn’t carry the same [return on investment] it once did because the cost is outrageous, and the outcome is uncertain,” Trevor Houston, a career strategist at ClearPath Wealth Strategies, previously told Fortune. “Students now face the highest amount of debt ever recorded, but job security after graduation doesn’t really exist.”

A Catch-22 for Gen Z workers

Younger generations feel stuck when it comes to choosing whether to go to college and what field to choose, Colin Rocker, a Gen Z content creator focused on career advice for early- and mid-career professionals, told Fortune. 

“Damned if they do or don’t [go to college],” Rocker said. “On one hand, their parents, counselors, and professors urge them away from more liberal arts majors like literature or history, but everyday in the news, they see thousands of people laid off who work with more technical degrees like engineering, computer science, and marketing, as AI starts to take over.”

There’s “no easy choice” anymore when it comes to choosing a career path, Rocker said. It used to be that pursuing business, tech, or health care were a shoo-in for success, but that’s not necessarily the case anymore considering how AI is changing jobs across the board. 

Gen Z “is now faced with carving out a place for themselves in an economy where they’re fighting for opportunity against the most advanced systems and technologies we’ve ever seen,” Rocker added. 

This story was originally featured on Fortune.com

© Getty Images