This story was originally published in Affordable Housing Finance.
Chicago is the most affordable rental housing market while Oakland, Calif., is the most expensive based on rent-to-income ratios, according to HomeUnion, an online real estate investment and management firm.
The company’s new study focuses on single-family residential (SFR) rentals.
“With its low cost of living, relatively large housing inventory levels, and high affordability, Chicago is an excellent market for residents entering the renting pool,” says Steve Hovland, director of research for HomeUnion, which reports that it’s the only metro in the country where typical renters spend less than 20 percent of their annual income on housing. Emerging neighborhoods like Logan Square and other West Side locations have become increasingly popular areas for young professionals, making Chicago an excellent choice for millennials.
Here’s a list of HomeUnion’s 10 most affordable rental markets in the nation:
| Metro | Annual SFR Rent | Annual Income | Rent to Income |
| Chicago | $19,956 | $102,180 | 19.5% |
| Charlotte, N.C. | $15,792 | $62,064 | 25.4% |
| Minneapolis | $20,580 | $77,568 | 26.5% |
| Detroit | $14,412 | $51,900 | 27.8% |
| Atlanta | $16,980 | $59,712 | 28.4% |
| St. Louis | $13,584 | $47,268 | 28.7% |
| Raleigh, N.C. | $18,480 | $63,180 | 29.2% |
| Houston | $19,404 | $60,912 | 31.9% |
| Oklahoma City | $14,088 | $44,100 | 31.9% |
| Tampa | $18,024 | $55,632 | 32.4% |
Here’s a list of HomeUnion’s 10 most expensive rental markets in the nation:
| Metro | Annual SFR Rent | Annual Income | Rent to Income |
| Oakland, Calif. | $37,524 | $73,284 | 51.2% |
| Cincinnati | $15,768 | $32,100 | 49.1% |
| Salt Lake City | $19,500 | $43,644 | 44.7% |
| Orange County, Calif. | $38,616 | $87,276 | 44.2% |
| Portland, Ore. | $24,132 | $54,816 | 44.0% |
| San Francisco | $53,328 | $121,440 | 43.9% |
| Washington, D.C. | $27,276 | $68,136 | 40.0% |
| Denver | $26,460 | $66,756 | 39.6% |
| Cleveland | $14,988 | $38,028 | 39.4% |
| San Diego | $33,444 | $85,872 | 38.9% |
Sources: HomeUnion Research Services; MPF Research, a division of RealPage
“Low affordability negatively impacts all renters in the Bay Area, Denver, Southern California, and Washington, D.C., because of strong local job market conditions, intense demand for rental properties, and high mortgage costs for owner-occupied housing,” Hovland says.
Established and mature markets, such as Cincinnati and Cleveland, where home prices remain affordable, negatively impact renters’ wallets. “A significant number of potential young renters are migrating out of Ohio to Chicago or booming western metros such as Denver, the Bay Area, and Los Angeles, leaving mostly low-wage earners to occupy rentals,” Hovland concludes.
This story was originally published in Affordable Housing Finance.
