Rents in the United States hit a record high in April, according to real estate listing site Realtor.com, with rents rising 16.7% compared to the previous year alone. In contrast, over the previous five years, gross rents increased by 18.1%. Rising housing costs have put a serious squeeze on the millions of Americans, typically younger ones, who already can’not afford to own a home. Many of those who are already being affected by inflation are likely to look to live in cities with more affordable rentals.
To determine the metros with the lowest rent, 24/7 Wall St. reviewed five-year estimates of median gross rent from the U.S. Census Bureau’s 2020 American Community Survey. The median gross rent across the United States is $1,096, and in these 50 metropolitan areas, it ranges from $765 to as low as $635. Of the 50 metro areas on this list, West Virginia has the most, with six, followed by Alabama and Ohio, with five each. Just over half of these metropolitan areas are in the South.
In many of the places where rents are lower, a relatively small share of housing units are occupied by renters, rather than homeowners. This is largely because these places have cheaper housing markets as a whole. In more expensive housing markets, many residents are priced out of owning a property, whereas in these metro areas, people are more likely to be able to afford to buy a house. The U.S. median home value is $229,800. All 50 of the metropolitan areas on this list have a lower median home value. This includes Danville, Illinois, where the typical home is worth $80,900, the lowest median home value of any metro area in the country. This is the income you need to be in the top 1% in every state.
Broadly speaking, housing costs reflect the income levels of the population living there. Wealthier communities have more expensive housing, and places with high levels of poverty tend to have cheaper housing. The metro areas with the cheapest rent all have lower median incomes compared to the national figure. The typical monthly U.S. household income is $5,416. In the Gadsden, Alabama, metro area, which has the fifth-lowest median gross rent, at $676, the typical household has a monthly income of $3,745.
But even when accounting for these lower incomes, most of the metropolitan areas are more affordable than much of the country. Nationwide, the annual median gross rent is equivalent to 29.6% of the median household income. In 37 of the 50 metro areas on this list, median rent accounts for a smaller share of the typical household income. In Jefferson City, Missouri, that figure only comes to 23.5% of the typical household income. These are the states with the lowest and highest rent.
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