3.6 million U.S. college graduates are being pushed into the red by hefty student loan repayments piled on top of rising rental costs.

By combining typical earnings, rent, and debt, our analysis shows the average young graduate is cost-burdened in 17 percent of U.S. counties. When student loan repayments are added, the number quadruples, to 71 percent.

College grads in the Class of 2017 are facing three sobering facts: In recent years, typical graduate earnings have stagnated or, for some majors, fallen;1 there are 1.3 million fewer vacant rental properties to choose from than in 2009;2 and rental prices for the available properties are on the increase.3 If that isn't enough to worry about, the average graduate's student debt is now $34,000 - 70 percent more than a decade ago.4

To explore how the combination of these factors makes renting an uphill struggle for college graduates, the Hunt.com data team combined the most recent earnings and student debt figures with rental prices from a sample of 2 million Hunt.com property listings, spanning May 2016 to May 2017.

The results show that monthly student loan repayments, averaging $221, are enough to push many graduate renters from borderline cost-burdened to moderately burdened, and in some cases into the severely burdened category.

We begin our exploration at the broadest level, by looking at what proportion of income was spent on rent by households in each state over the last seven years.

Cost-Burdened Renters in Each State vs. U.S. Average

The rule of thumb is that you shouldn't spend more than 30 percent of your income on rent. If you do, the U.S. Department of Housing and Urban Development (HUD) deems you to be cost-burdened, which means you could struggle to pay for necessities like food, transport, and medical bills. Pay more than 50 percent and you're considered severely cost-burdened.5 While a true measure of housing affordability is more complex than the 30 percent rule, it nevertheless serves as a useful standard for examining trends over time.

Our map, which uses data from the American Community Survey, shows that over the last seven years, half of households across the U.S. have been cost-burdened by their rent.

The five states with the highest share of cost-burdened renter households were Florida (58.7%), California (57.4%), Hawaii (57.4%), Oregon (54.7%), and New Jersey (54.2%).

The five lowest were South Dakota (40.5%), North Dakota (40.5%), Wyoming (41.0%), Nebraska (43.6%), and Kansas (44.8%).

The fact that around half of U.S. renters are cost-burdened is remarkable for a couple of reasons. First, because the renter population is larger than it's ever been, having increased from 31 percent in 2005 to 37 percent in 2015.6 Second, because it's not always been this way: In 1960, less than one-quarter of people spent more than 30 percent of their income on rent; now it's double that.7

So, the first consideration in whether a graduate is likely to be cost-burdened by rent is simply where in the country they live, or, for the 81 percent of first-time students who enroll at public colleges within their home states, where they happened to be born.8 In Florida, where 91 percent of college students are state residents, nearly six in 10 renter households spend more than 30 percent of their income on rent.

In Florida, where 91 percent of college students are state residents, nearly six in 10 renter households spend more than 30 percent of their income on rent.

In Florida's case, the problem with housing unaffordability is largely a product of low-wage jobs and a lack of rental homes that are modestly priced, as opposed to newly developed luxury properties. The combination of these factors meant that, between 2009 and 2015, the rental vacancy rate in Florida more than halved, from 17.8 percent to 8 percent, and inevitably pushed prices up.9

It's not just the state a graduate lives in that affects how much they might struggle with rent, but also where in the state they call home. Renters tend to be more cost-burdened in densely populated urban areas, and young people, especially graduates, are increasingly choosing to live in big cities instead of the suburbs.10

Renters Who Are Cost-Burdened in 25 Selected Cities vs. U.S. City Average

Certain U.S. cities have extraordinarily costly rental markets. New York, Boston, San Jose, and, of course, San Francisco regularly top "the most expensive places to rent" lists. But earnings are also higher than average in all of these places, which means their share of cost-burdened renters isn't always exactly what you'd expect.

We selected the 25 cities above to show a cross-section of cost-burdened urban rental markets, ranging from the place with the highest average burden between 2010 and 2015 (Hialeah, Florida) to the lowest (Sunnyvale, California). In Hialeah, only 16 percent of people aged 25–34 had a bachelor's degree in 2015, compared to 33 percent nationally.11 Hunt.com's apartment listings data show that the average one-bedroom property in Hialeah cost $1,132 a month in 2015, but the average monthly income for someone with a bachelor's degree was only $2,200. In other words, the few graduates living there spent over half of their income on rent.

Hialeah, Florida is the most cost-burdened city for renters in the U.S. – the average college graduate who lives there spends over half their income on rent.

The situation in Flint, Michigan, is a little different. Like Hialeah, a far lower proportion of young people have a bachelor's degree than average (9.7 percent), but graduates' income is higher relative to rent. In Flint, a 25–34 year old graduate living alone only spent 17 percent of their income on rent in 2015, despite 41 percent of the overall renter population spending more than 30 percent.

At the other end of the scale is Sunnyvale, California, where, in 2015, 71 percent of 25–34 year olds had a bachelor's degree or higher, and rent was 160 percent higher than average, at $2,331. However, given that Sunnyvale is in Silicon Valley, median income for graduates was $83,737, which meant that 37 percent of households in the area spent between 30 and 49 percent of income on rent, making it the least cost-burdened city in the nation.

Mountain View and San Francisco, both in or right nearby Silicon Valley, have a similarly low share of cost-burdened renter households to Sunnyvale, but that doesn't mean living in these cities is simple for the average college graduate, especially when student loan repayments begin leaving their bank account.

Rent as a Percentage of the Avg. College Graduate's Monthly Income, Excluding and Including Student Loan Repayments

It isn't easy to estimate the burden that student debt puts on the average college graduate renter in every U.S. county. To do it, we had to combine six data sources: Hunt.com rental data and HUD Fair Market Rents (rental costs); BLS Census of Employment & Wages and the American Community Survey (young graduates' income); U.S. Department of Education College Scorecard Data (student debt); and IRS Migration Data (to estimate the movements of graduates after leaving college).

The first map above shows what proportion of the average graduate's income is spent on rent in each U.S. county. It assumes they live alone in a one-bedroom property, which not every graduate does, but this assumption allows us to compare places on a like-for-like basis.

The average graduate in 29 percent of U.S. counties spends less than 30 percent of his or her income on rent each month, which means they are not considered cost-burdened. In 541 counties (17 percent), the typical college grad is moderately burdened, because he or she spends between 30 and 49 percent of income on rent, and in 28 counties (one percent), they are severely burdened, spending more than 50 percent.

One-third of college graduates aged 25–34 are at risk of being moderately burdened by the cost of their rent.

11 percent are at risk of spending more than 50 percent of their income on rent, making them severely cost-burdened.

The situation changes considerably when we include monthly student loan repayments. The average U.S. college graduate pays back $221 per month, with county averages ranging from $46 in Covington, Alabama, to $398 in Van Buren, Iowa. When debt is combined with regional earnings and local rent prices, a different picture emerges, in which the average graduate in 2,130 counties (68 percent, up from 17 percent) is moderately cost-burdened, and severely burdened in 107 counties (3.4 percent, up from one percent).

When student debt repayments are added to rent, 59 percent of college graduates aged 25–34 are at risk of being moderately burdened and 13 percent are at risk of being severely burdened.

Put simply, average student debt repayments represent a sizeable enough share of income to put 3.6 million college graduate renters at risk of being moderately cost-burdened, who would otherwise spend less than 30 percent of their income on rent.

Counties Where College Graduates Are Most Burdened by Rent and Student Debt

The 16 counties in the table above are the most cost-burdened in the country. In Monroe County, Florida, there are 2,300 graduates at risk of being severely cost-burdened by their rent, which eats 84 percent of their income, rising to 90.1 percent when the average student debt repayment of $167 per month is included.

The second most cost-burdened county is Kings County, New York, a.k.a. Brooklyn. 210,000 college grads are cost-burdened in Brooklyn, where the average graduate's income is only 27 percent higher than the rent for a one-bedroom apartment. That leaves just 15.5 percent of their income after deducting an average $174 student loan repayment.

Across the five NYC boroughs, there are a total of 713,000 graduates at risk of being severely cost-burdened by their rent and student loan repayments.

Attentive readers may have noticed that San Francisco County ranks 11th highest among the most cost-burdened counties for graduate renters, despite the fact that earlier we saw the City of San Francisco among the least burdened cities. This is because, despite extremely high rental prices, the median earnings for a graduate in the City of San Francisco are high enough to prevent them from being severely cost-burdened (39 percent of renter households were cost-burdened in 2015, compared to 53 percent in the average U.S. city). However, earnings in the county as a whole aren't high enough to offset rent, which remains very high, even outside the Bay Area.


More Borrowers, Student Debt, and Rent, but Graduates' Income Remains the Same

In the chart above we can see the key factors that put graduate renters in the position they are in today.

More people than ever before have college degrees; a higher proportion are borrowing larger amounts, causing monthly repayments to swell; and most graduates' income has stagnated. In fact, the average salary of a college graduate renter aged 39 or under is essentially the same as it was in 2004, after adjusting for inflation.

So what's a young person, who can't buy a home but doesn't want to pay through the nose to rent one, supposed to do? Skip going to college to avoid picking up and having to pay back student debt?

Probably not. Cleveland Fed economist Joel Elvery noted in 2015 that the eventual financial benefits of going to college more than offset the cost of student loan repayments for most borrowers. Specifically, borrowers who pay back between $203 and $400 a month will end up earning $750 more per month than people of the same age with just a high school degree.12 Of course, a lot rides on which college a person attends and what their major is (estimated earnings vary a lot by both), as well as the job they secure after graduating and where they live.

Borrowers who pay between $203 and $400 per month in student loan repayments will end up earning $750 more than people of the same age with just a high school degree. – Joel Elvery, Cleveland Fed economist

To wrap up our exploration, we'll zoom to the level of individual institutions and compare the estimated earnings and student loan repayments for graduates of the country's 50 best colleges. The income figures come from the Center on Education and the Workforce, at Georgetown University. They estimate earnings after accounting for differences in institutions' composition of majors, academic preparation, and graduate degree attainment, and are therefore considerably more realistic than the unadjusted figures often used in college ranking tables. The rent figures are for one-bedroom properties located within the same county as each institution.

As you can see, comfortably renting as a graduate is a balancing act between earnings, debt repayments, rent, and other living costs. Even an average student at one of the best universities in the country, Columbia, will see 77.9 percent of their earnings disappear if, after graduation, they choose to – and can find a landlord who will let them – live alone in Manhattan.

The Cost of Living and Student Debt for Graduates of the 50 Best Colleges