Personal Finance News
WalletHub Study Highlights Cities with Most Affordable Rent
A new study crunched the numbers to see which U.S. cities had the most — and least — affordable average rental rates.
About the Affordable Rent Study:
The personal finance site WalletHub recently released its latest list of the cities where rent is the most affordable. To arrive at these rankings, the site first looked at data from 182 cities across the United States. This included the 150 most populous cities plus at least two of the most populous cities in each state. Then, the site compared median annual gross rent with median annual household income to calculate the percentage of income average renters were paying.
Topping the list as the most affordable city for rent was Bismarck, North Dakota. There, the median rent is just 15.29% of the median salary. Meanwhile, Sioux Falls in neighboring South Dakota placed second with 16.35%. Cedar Rapids, Iowa (16.48%); Charleston, West Virginia (16.56%); and another North Dakota city, Fargo (16.94%), completed the top five.
On the other side of the list were some perhaps surprising cities. Ranking last at 182nd was Miami, Florida — where the median rent costs 33.77% of the median income. In a completely different part of the country, Detroit, Michigan was second-to-last at 32.27%. Also near the bottom were Newark, New Jersey (32.09%); New Haven, Connecticut (31.41%), and Jackson, Mississippi (30.09%).
Looking closer at WalletHub’s list, there are some other interesting anomalies. For example, Fontana, California ranked 51st with 21.46%, while other Inland Empire cities Riverside and Rancho Cucamonga were at 127th and 129th, respectively, with percentages above 25%. Also, looking at the map, cities in Florida were more likely to trend toward the bottom of the list than cities in the Golden State. In fact, there are three Sunshine State cities in the bottom 10 compared to just one California city (Glendale). Also, two Northern California cities placed in the top 25, whereas no Floridian cities appear until Jacksonville at 125th.
What They’re Saying:
Commenting on the study’s results, WalletHub analyst Chip Lupo noted, “In the most affordable cities for renters, the median cost of rent is as low as 15% of the median income, compared to nearly 34% in the most expensive cities. This gives people in the least expensive cities a clear financial advantage; the money they save on rent could go toward their emergency fund or savings for future home ownership.”
My Thoughts:
Looking at these rankings, there are some truly shocking “upsets.” Then again, that could partially be because WalletHub used median income and rent rather than the mean. I’d be curious to see how much the list would change with that methodology. In any case, I think this is a good reminder about how even cities that are close geographically can have very different economies.
Author
Other Articles by Kyle Burbank
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