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While homeownership is desired for many Americans, economic uncertainty and already-elevated living costs are rising, leaving many potential homebuyers no other alternative but to rent. According to data from the National Multifamily Housing Council, roughly 44 million American households have opted to rent rather than buy their homes because of convenience, cost, or both.
However, renting isn’t always a cheaper or better alternative to owning a property. A new WalletHub survey revealed which factors determined where renters could get the most bang for their buck, ranking the best and worst places to rent.
According to experts, the right road to take depends on a variety of factors, including an individual’s or family’s financial means and how well the local real estate market is doing.
Hialeah, Florida, the sixth-largest city in the state, was ranked the worst city in America for affordable rentals.
As inflation significantly impacted rental prices, 2022 experienced the second-highest price growth in decades, recording a 6.2% year-over-year increase. Meanwhile, mortgage rates have also experienced big year-over-year jumps.
Like home prices, however, rental rates can vary significantly by region, state, or city. In some places, renting will prove to be more cost-effective and a better overall value than owning.
Top 10 Best Places to Rent in the U.S.
- Overland Park, KS
- Scottsdale, AZ
- Bismarck, ND
- Sioux Falls, SD
- Chandler, AZ
- Fargo, ND
- Plano, TX
- Lincoln, NE
- Irvine, CA
- Nashua, NH
Overland Park, Kansas, in Johnson County, is the second-most populous city in the state and was ranked the best place to rent in the U.S.
Top 10 Worst Places to Rent in the U.S.
- Detroit
- Cleveland
- Memphis, TN
- Jackson, MS
- Akron, OH
- Chattanooga, TN
- New Orleans
- Huntington, WV
- Shreveport, LA
- Hialeah, FL
"Fast-growing cities are often short on rental properties, which can drive prices up," said Randal Ice, Barnabas Professor of Finance Emeritus at the University of Central Oklahoma. "However, these cities also tend to have newer, higher-quality housing stock, which means that apartments are safer and more comfortable for contemporary lifestyles. While supply and demand eventually balance out, in the initial stages of fast growth, rental prices may be higher. However, as the market stabilizes and more rental units become available, prices should start to equalize."
- Detroit
- New Heaven, CT
- Newark, NJ
- Miami
- Hialeah, FL
Cheyenne, Wyoming, the capital city, was ranked the best place to rent with the most affordable rentals.
- Cheyenne, WY
- Bismarck, ND
- Cedar Rapids, IA
- Sioux Falls, SD
- Overland Park, KS
"The places that are going to be the cheapest for renters are cheap for a reason: nobody wants to work or live there," said Gilles Duranton, Dean's Chair in Real Estate Professor, Wharton Real Estate Department at the University of Pennsylvania. "Places that do well and grow will be in high demand for rentals and thus expensive."
