Understanding Housing Affordability in 2025

Recent analyses indicate that minimum wage workers in the U.S. will need to work significantly beyond typical full-time hours to afford decent housing. The median monthly rent for an apartment has climbed to approximately $1,599, according to Redfin.

As a rule of thumb, individuals are advised to allocate no more than 30% of their income toward housing expenses. However, with mounting rental prices, adhering to this guideline is becoming increasingly challenging, particularly for those earning minimum wage.

The Challenges of Minimum Wage Living

For those earning the federal minimum wage of $7.25—which has remained unchanged since 2009—affording this median rent becomes a daunting task. Even in states where the minimum wage is higher, the average wage for a minimum wage worker is projected to be around $11.59 by 2025. To meet the rental cost of $1,599, workers would need to clock in approximately 106 hours a week, an unrealistic requirement for most.

Daryl Fairweather, Chief Economist at Redfin, highlights the disparity: “It’s virtually impossible for a minimum-wage worker to afford the typical apartment on their own…” This situation pushes many to seek alternatives, such as shared housing or public assistance.

A Closer Look at the U.S. Rental Landscape

Cost Comparison: Renting vs. Buying

The decision between renting and buying a home continues to be a complex one in 2025. According to a report by ATTOM, both options present financial challenges, consuming 25% to 60% of workers’ monthly income. Notably, owning a single-family home is likely to be less expensive than renting a three-bedroom house in about 60% of the analyzed markets.

Most Affordable Rental Markets

Following are some of the most affordable areas for renters in the United States:

• Black Hawk County (Waterloo, Iowa)
• Wayne County (Detroit, Michigan)
• Genesee County (Flint, Michigan)
• Jefferson County (Birmingham, Alabama)
• Hinds County (Jackson, Mississippi)