Housing took bigger bite out of household budgets in 2025, new report shows

The percentage of North Carolina households cost-burdened by rent or mortgage payments ticked up slightly in 2025 to 29%, according to the N.C. Housing Coalition. Nearly a third —1.2 million — of the state’s 4.1 million households are cost-burdened, meaning they spend more than 30% of income on housing.

In 2024, 28% of renters and homeowners had difficulty affording their homes.

Nearly half of renters — 49%— are cost burdened, the coalition found. That’s 638,780 households — 23,199 more than the 615,581 recorded in 2024 when 48% were cost-burdened.

Meanwhile, 20% — 552,003 households — of homeowners have difficulty affording their homes. Clay County in the western part of the state has the highest percentage of cost-burdened homeowners at 30%, according to the report.

When homeowners and renters are combined, Hertford (39%), Watauga (38%) and Cumberland (37%) counties are among the most cost-burdened in the state, according to the report.

Stephanie Watkins-Cruz, the coalition’s director of housing policy, said housing needs in North Carolina are growing faster than the state’s response.

“These numbers represent North Carolinians pressured to make impossible choices between rent and groceries, mortgage payments and medical expenses,” Watkins-Cruz said. “Housing is foundational to economic development, health, education, and disaster recovery, and now is the time for bold, bipartisan housing investment that meets the scale of the need in our state.”

Watauga County has the highest percentage — 66% — of cost-burdened renters, followed by Hertford and Hyde counties where 63% of renters have trouble paying their rent, according to the report.

There’s no county in the state in which a person earning the $7.25 minimum wage can afford a one- or two-bedroom apartment, the coalition said. On average, an individual needs to make $22.32 per hour to afford a two-bedroom apartment, it said.

The fair-market rent of $1,750 a month for two-bedroom apartments in Franklin, Johnston and Wake counties is among the highest in the state, the coalition found. A renter must earn a minimum $33.65 an hour “housing wage” or $70,000 a year to afford a two-bedroom apartment in those counties. Construction workers, childcare workers and firefighters find it difficult to afford a two-bedroom apartment, the profiles show.

Still, it’s down slightly from the previous year. In 2024, the fair-market rent for Franklin, Johnston and Wake Counties was $1,763 — $13 higher.

Fair-market rent is the cost to rent a moderately priced apartment. It’s determined by the U.S. Department of Housing and Urban Development (HUD), and is used to determine payment for the federal Housing Choice Voucher program, which provides rental assistance to low-income families, the elderly and disabled citizens.

In 2024, Durham-Chapel Hill topped the list for  the most expensive fair-market rent at $1,872 for a two-bedroom apartment, but it dropped in the latest survey to $1,711 a month — $161 less than the previous year.

Watkins-Cruz said the lower fair-market rents do not necessarily signal a cooling rental market.

“That [fair-market rent] only represents 40% of the market, so the market is actually much higher,” Watkins-Cruz said.

The most affordable fair-market rent in the state for a two-bedroom apartment is $925 a month in several rural counties throughout the state. A housing wage of $17.79 an hour or an annual income of $37,000 a year is needed to afford a two-bedroom apartment at that price.

The coalition’s county profiles provide a snapshot of housing needs for each of the state’s 100 counties. The profiles are updated annually to reflect new data from the most recent American Communities Survey, FY 25 HUD Fair Market Rents,  U.S. Bureau of Labor Statistics, Civil Issue Filing and Order Results – NC Administrative Office of the Courts, and Hurricane Helene Designated Disaster Areas.

The North Carolina profile shows 11,830 families faced foreclosures and 201,015 faced eviction filings. Edgecombe County ranked number one for evictions among renters, followed by Nash and Vance counties.

The coalition added a new feature this year showing the impact of Hurricane Helene in the state. It noted that 38,000 homes were damaged and more than 1,000 homes were destroyed. The damage exacerbated the housing crisis in one of the state’s fastest growing areas, the coalition said.

“Last year, we just acknowledged the disaster-impacted counties, so as we get data, we wanted to show the damage as well as the preexisting and ongoing cost burden and rise in the cost of living as well,” Cruz-Watkins said.

The coalition said the data does not fully represent post-flood housing conditions and that housing needs in impacted counties are likely greater.