15 Cities Becoming More Renter-Friendly and Less Buyer-Friendly

Between high prices and low housing inventory, there's not a lot of good news in real estate right now. But here's one silver lining — some markets are becoming more affordable for renters.

A recent study from Realtor.com revealed a year-over-year (YoY) decline in the percentage of income spent on rent for a small (0-2 bedroom) dwelling in 15 markets across the U.S.

By paying less than the recommended 30% of income on housing, renters can lower their financial stress. And in these places, that is getting a little easier for renters to do.

YoY change: -0.1%

Rent prices have dropped around 0.2%, which has contributed to the slight decrease in expenditures on rent. Now, a modest apartment will set renters back about $1,611 per month.

Milwaukee renters spend an average of just 26.1% of their income on rent — well below the 30% recommended limit. Homeowners, on the other hand, are still spending 30.6% of their income on housing.

YoY change: -0.2%

Rents in Beantown have actually risen slightly to 0.5% over the last year, even though the percentage of income spent on rent has gone down. From this, we can deduce that incomes have risen.

Bostonians spend about 32.1% of their income on rent, which runs about $2,925 per month. By contrast, homeowners in Boston spend about 45.8% of their income on housing.

YoY change: -0.3%

There is good news and bad news for Pittsburg renters: Renters only spend 23.5% of their income on rent, but buyers spend even less — only 19.7%. Rent is a modest $1,431, which is actually 0.2% more than it was last year.

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YoY change: -0.4%

Rents in Virginia Beach run about $1,494, which is down about 0.8% from last year. That represents about 22.3% of renters' income. Homebuyers, on the other hand, spend 30.4% of their income on their homes.

YoY change: -0.4%

Minneapolis saw the same decrease in the percentage of income spent on rent as Virginia Beach did, though the rental price is up around 0.2%, which comes out to about $1,507. Still, that only costs renters 18.7% of their income — much less than homeowners, who pay approximately 27.5% for housing.

YoY change: -0.4%

Baltimore is tied at 0.40% when it comes to the decrease in the percentage of income spent on rent. However, rents have gone up 0.1% over the same year, and it's worth noting that the percentage that renters pay for housing (22.5%) is very similar to what homeowners pay (23.1%). The average rent in Baltimore runs about $1,786.

YoY change: -0.7%

Renters pay a much lower percentage of their income than homeowners do, which comes to 21.1% vs. 39.6%. Their rents are even lower than a year ago by 0.3%, and they now come to around $1,665 a month.

YoY change: -0.9%

Rents have fallen 0.5% in the City of Brotherly Love, as has the percentage of their income renters must devote to it. Most Philadelphians spend about $1,754 on rent. Meanwhile, renters and homeowners spend similar percentages of their incomes on their housing payment, which equals 23.9% and 24.9% respectively.

YoY change: -1.3%

Part of the reason for renters spending less of their money on housing in Houston is that rent prices have decreased by 1.8%. That puts the average rent price at about $1,359 per month. Renters in Houston are putting far less of their paycheck toward housing, 20.7% as opposed to 28.5%.

YoY change: -1.4%

Rental prices have fallen a notable 3.6% in the Windy City, easing housing costs for renters, who now pay about $1,776 per month. Homeowners and renters pay very similar percentages of their income toward housing, 24.6% vs 24.8%.

YoY change: -1.4%

Falling rent prices — prices are down 1.2%, which comes out to about $1,520 a month — are just part of the story behind the decrease in the percentage of rent the people of Charlotte pay. Renters are faring much better than their home owning counterparts, spending 22.4% of their incomes on housing as opposed to 32.3%.

YoY change: -1.8%

L.A. isn't a cheap place to rent when you consider that a 0-2 bedroom apartment goes for about $2,736 a month. However, rent has gotten 2.6% cheaper since last year.

Both renters and homeowners pay over the recommended 30% of their income for housing, but L.A. renters are in much better financial shape than homeowners. They pay 35.9% of their income on housing as opposed to the whopping 74.7% that homeowners pay.

YoY change: -1.9%

Vegas renters saw their rents fall 2.2% in the last year, and they're now averaging about $1,457 per month. While Sin City renters spend below the recommended housing threshold for income at 24.1%, homeowners pay well above it 40.4%.

YoY change: -2.1%

Falling rents are a big part of the story of what's going on in the San Bernardino area. Rents have fallen a whopping 4.1% since last year, down to $2,065 per month.

And while renters don't have it easy in this expensive area of California, they're still paying below the 30% limit of their income on housing at 28.8%, while homeowners are paying well above it at 43.6%.

YoY change: -2.4%

Renters in Memphis saw prices fall 4.3% over the last year, and rent prices are coming in at just $1,177 a month. 

That's pretty affordable when you consider it means that renters are only spending 21.1% of their income on rent, compared to the 30.8% homeowners are paying on their mortgage.

While building equity in a home is a great financial goal, renting is the more economical choice for many Americans. 

In markets where rental costs are decreasing as a percentage of income, tenants have an opportunity to improve their financial fitness by redirecting those savings toward emergency funds, retirement accounts, or a future down payment.

Paying less for housing doesn't just ease monthly budget constraints — it creates pathways to achieving a sense of financial security that can weather whatever economic storms lie ahead.