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This is my final project for PP434: Automated Data Visualization for Public Policy. It is a work in progress.
My assingment is to make 5-8 data visualizations on a policy-related topic of my choice and discuss my aims, data, analytical challenges, and conclusions.
The United States is facing a once-in-a-generation housing affordability crisis. In mid 2022, a typical american renter devoted a greater share of her income to rent than at any point this century. Housing is chronically undersupplied in most of the places where people want to live, and the crisis was made acute when demand for housing surged in the wake of the COVID-19 pandemic.
Happily, the crisis peaked in mid-2022. This is little comfort to millions of Americans whose rent is still eating up more of their monthly budget than ever before, but it does mean that explosive rent growth has ended in many areas. Policy makers throughout the country (mainly in the south and southwest) have recognized the crisis and taken steps to address it by unlocking abundant housing.
Not all areas are so lucky, however. Recovery has been uneven and the crisis is still raging in many parts of the country. This project aims to explore the geography of the rent crisis in the US, understand the factors that drive rent inflation, and highlight effective policy solutions.
First, a brief note on my choice of rent rather than home values as my variable of interest: Home values have also exploded in the past five years, but I consider them mostly out of the scope of this project. I chose to focus on rent two two reasons. First, rent it is a more immediate concern for most middle- and lower-income Americans who do not own their home. Relatedly, Americans who own their homes do not necessarily consider the events of the past five years to be a crisis. In fact, many homeowners have seen their net worth increase dramatically with their home values. For renters, the past five years have been a crisis.
The surge in rent prices is not simply the result of post-pandemic inflation.The chart below shows the year-on-year change in rent prices and inflation since 2016. Rent inflation outpaced overall inflation for years before the pandemic began and immediately after the pandemic, rent prices rose an order of magnitude faster than overall prices. Since this peak, rent inflation has slowed to around pre-pandemic levels in the past year. Currently, rent inflation is only outpacing overall inflation by less than a percentage point. This national trend conceals a great deal of regional variation, however. As the proceeding charts will demonstrate, some places have brought their rent growth under control, while others are still in the throes of a housing crisis.1
To understand America's rent crisis, it helps to understand which areas are gaining and losing population. The map below shows population change from 2020 to 2023 by state. Since the pandemic, hundreds of thousands of people have moved away from large states with major cities. New York, California, and Illinois experienced the biggest losses. Meanwhile, the states in the 'sun belt' (roughly, the southeast, southwest, and mountain west) has seen the largest population gains. The primary driver of this migration is the cost of living. Housing costs in major coastal cities and Chicago have become prohibitive for many Americans, who are seeking cheaper (and warmer) areas as a result. This has been helped along by the rise of remote work - many Americans are no longer tied to their place of employment and can live wherever they want.2
Not all areas have experienced the same rent inflation. The first map below shows the change in rent index over the past five years by county. Looking at the five-year view, we see few counties have been immune from spiking rents. The southeast and southwest saw the greatest increases in rent. Florida seems to be the most impacted.
The one-year view tells a different story. Over the past year, rent inflation is felt most acutely in the midwest and northeast. In the sunt belt, rent inflation is near or below overall inflation. A small handful of counties, mostly in the Texas, even saw their rent index decrease over the past year.3
I believe the rent crisis is mainly caused by an under-supply of housing in the areas where people want to live. When there are fewer available rental units in an area, renters have to compete for a limited number of homes, which gives landlords room to charge higher rents.
Consider the chart plotting America's 50 largest metro areas, comparing their rent index changes against new multi-unit housing approvals per 10,000 residents this year. A clear pattern emerges: metro areas experiencing the highest rent inflation tend to have the lowest home building rates. This relationship is particularly stark in mid-sized northeastern cities like Hartford, Providence, Buffalo, and Cleveland, where rent inflation exceeds 5.5% while new multi-unit construction languishes at fewer than 2 structures per 10,000 people.
At the opposite end of the spectrum stands Austin, which is emerging as a beacon of housing affordability amid a national rental crisis. With more than 10 new multi-unit structures per 10,000 people—the second-highest building rate nationally—Austin has managed to buck the trend of steep rent increases plaguing other major metros.4
The next chart provides further evidence of a supply-driven market dynamic. It plots the same 50 metro areas, comparing rent inflation against the Zillow Observed Rent Demand Index (ZORDI), which measures the typical traffic a rental listing receives on their site. While "rent demand" might suggest total market activity, ZORDI actually captures the level of interest each individual rental listing attracts. In essence, it's a barometer of competition for available units in each metro area.
This visualization presents almost a mirror image of the previous chart. Metro areas experiencing the steepest rent increases typically show the lowest ZORDI scores. The contrast between our previous extreme examples, Austin and Hartford, becomes even more striking here—their positions flip. Renters face extreme competition in Hartford and very little in Austin.5