Housing affordability

The government considers people who spend over 30 percent of their income on housing to be “cost-burdened.” Those who spend more than 50 percent are considered “severely” burdened.

About one-third of households — 38.9 million — were considered cost-burdened in 2015, down from 39.8 million a year earlier. This was the fifth straight annual decline.

Still, roughly 16 percent of households, or about 18.8 million, paid more than half their income on housing. The share of renters paying more than they can afford varies from city to city. In Miami, it’s 35.4 percent. In El Paso, Texas, it’s just 18.4 percent. Other cities where households were deemed to be cost-burdened include Daytona Beach, Florida; Riverside, California; and Honolulu.

Ryan Welch of Santa Monica, California, is among those feeling stuck between rising rents and home prices. Welch, 32, pays about $1,500 a month for a rent-controlled one-bedroom apartment he shares with his wife. That works out to about a quarter of their monthly income, an affordable portion.

Welch, who works in advertising sales, would like a bigger place with more amenities. But he’s reluctant to leave their apartment.

“I’m nervous to move to a place that’s not rent-controlled,” he said.

Saving to own a home, something he wants to do, has had to take a back seat to making payments on student loans and his car, among other expenses.

“I’d much rather buy, but I can’t come up with the down payment,” Welch said. new home for sale was on the market for just 3.3 months, according to the report — well below the average of 5.1 months dating to the 1980s.

All told, 1.65 million homes were on the market last year, the fewest in 16 years, the report said.

The supply is worse for lower-priced homes that would be affordable to typical first-time buyers. Builders have been constructing fewer homes for that segment of buyers.

Between 2004 and 2015, construction of single-family homes of less than 1,800 square feet fell to 136,000 from nearly 500,000, according to the report.

The trends helped boost national home prices 5.6 percent last year, above their housing boom peak. (Prices remained nearly 15 percent below their peak, when adjusted for inflation.)

“Builders are starting to turn more attention to the entry-level market,” Herbert said. “My guess is we’ll see some increase in our supply of smaller, more moderatecost new housing on the single-family side.”