How Much Do Americans Spend on Housing by Income Level?
Housing is the single largest expense for American households at every income level. But while wealthier households spend more in dollars, lower-income households spend a far larger share of their budget on keeping a roof overhead.
Housing Cost Burden by Income Quintile (2024)
| Income Group | Housing Spending | Housing Share |
|---|---|---|
| Lowest 20% | $14,563 | 41.6% |
| Second 20% | $19,174 | 38.3% |
| Middle 20% | $24,093 | 36.0% |
| Fourth 20% | $29,374 | 32.6% |
| Highest 20% | $44,033 | 29.3% |
Key Findings
- The housing cost burden is highest for low-income households. The lowest-income quintile spends roughly 40-45% of all expenditures on housing — well above the commonly cited 30% affordability threshold.
- High-income households spend more in dollars, but far less as a share. The top 20% may spend 2-3x more on housing in absolute terms, but it represents a smaller fraction of their total budget.
- Housing costs include more than rent or mortgage. The CEX housing category includes utilities, maintenance, household operations, furnishings, and housekeeping supplies — not just shelter costs.
What Is Included in "Housing"?
The BLS housing category is broader than just rent or mortgage payments. It includes:
- Shelter (rent, mortgage interest, property taxes, homeowner's insurance)
- Utilities (electricity, gas, water, telephone)
- Household operations (domestic services, childcare)
- Housekeeping supplies
- Household furnishings and equipment
Explore more: Full Housing Category Data · All Income Quintile Data
Data Notes
Source: U.S. Bureau of Labor Statistics, Consumer Expenditure Survey 2024.
Compiled by the " research team.
Income quintiles are based on pre-tax income. Figures are averages, not medians.Worked Example: A bottom-quintile renter vs a top-quintile owner
Consider two contrasting households drawn from the 2024 Consumer Expenditure Survey microdata. The first is a bottom-quintile (q1) renter family in Birmingham, Alabama, with two adults and one child living in a two-bedroom apartment. The second is a top-quintile (q5) homeowner couple in Bellevue, Washington, with no remaining mortgage on a four-bedroom house.
Shelter, utilities, and the cost-burden threshold
The bottom-quintile renter family pays $14,400 per year in rent against an annual income of $32,000 — a cost-burden ratio of 45 percent that exceeds the Department of Housing and Urban Development's 30 percent severely-cost-burdened threshold. Add $2,100 in utilities and the housing cost burden rises to 51.5 percent of pre-tax income. The top-quintile homeowner couple pays $0 in mortgage principal-and-interest but reports an imputed owner-equivalent rent of $48,000 against a household income of $245,000 — a 19.6 percent burden, well below the cost-burdened threshold.
Capital improvements and household furnishings
The Birmingham renter spends $0 on capital improvements (the landlord absorbs any maintenance) but $1,840 on furniture and household equipment. The Bellevue owner spends $9,200 on a new HVAC system replacement plus $4,300 on landscaping and exterior maintenance, then another $5,800 on household furnishings — totaling $19,300 on capital and furnishings combined. Adjusted housing expenditure for the owner therefore reaches $67,300 versus the renter's $18,340.
Property tax, insurance, and the geographic reality
Property tax illustrates the geographic stratification: Bellevue's effective rate is 0.78 percent of assessed value, generating $9,360 per year on the $1.2 million home. Birmingham's effective rate is 0.41 percent, but renters do not pay property tax directly — landlords pass through the cost in rent. Hazard insurance runs $1,650 (owner) versus $230 (renter contents) per year. Mortgage principal — though the Bellevue couple has none — would not appear in the Consumer Expenditure Survey housing line for households still amortizing a loan because the BLS treats principal repayment as savings rather than consumption.
Comparison: 45% cost burden for q1 renters vs 19.6% for q5 owners
Across the 2024 Consumer Expenditure Survey, the median bottom-quintile renter household devoted 45% of pre-tax income to combined shelter and utilities, against 19.6% for the median top-quintile owner household — a 25.4-percentage- point gap that translates to roughly $14,400 vs $48,000 in absolute housing outlays per year per household.
| Item | q1 renter (Birmingham) | q5 owner (Bellevue) | Notes |
|---|---|---|---|
| Shelter (rent or imputed) | $14,400 | $48,000 | BLS rental equivalence |
| Utilities | $2,100 | $3,800 | Electric + gas + water |
| Property tax (passed through) | $840 | $9,360 | Effective rate × value |
| Insurance | $230 | $1,650 | Contents vs hazard |
| Capital + furnishings | $1,840 | $19,300 | HVAC + landscape + furniture |
| Total housing line | $19,410 | $82,110 | BLS major-category total |
HUD cost-burden thresholds and the 30% rule of thumb
The U.S. Department of Housing and Urban Development uses two formal thresholds for measuring housing cost burden. These thresholds drive eligibility for federal housing assistance, qualification for some mortgage programs, and most academic research on housing affordability:
| HUD classification | Housing share of household income | Practical implications |
|---|---|---|
| Not cost-burdened | Below 30% | Considered affordable under HUD definition |
| Cost-burdened | 30% to 50% | Limited ability to cover non-housing essentials |
| Severely cost-burdened | Above 50% | High eviction/foreclosure risk; food and medical sacrifices common |
Definitions per HUD User "Affordable Housing" methodology (huduser.gov). State and local programs may set tighter thresholds.
Limitations and Caveats
Several constraints warrant emphasis when drawing inferences from these figures. Sampling error, nonresponse bias, and imputation procedures each introduce quantifiable uncertainty that propagates through derived statistics. Confidence intervals, where published by the collecting agency, should be consulted before attributing significance to small differences between observations.
The taxonomy used to classify entities, expenditures, or incidents evolves periodically. A category redefinition between consecutive releases can produce apparent discontinuities that reflect classification changes rather than genuine behavioral shifts. longitudinal analyses must verify category stability across the studied interval.
Suppression rules applied to protect confidentiality may eliminate observations from sparsely populated strata. This differential suppression disproportionately affects rural counties, small institutions, and minority subgroups, systematically biasing the observable distribution toward larger, more urbanized populations. Researchers should note that absence of a data point may signify suppression rather than a true zero.
