Experts say tiny communities in the South and Southeast are now the best areas to rent in 2018. In 2022, Round Rock, Texas, a suburb of Austin, was chosen as the finest area to rent in the United States.
They compile and rank confidential data on hundreds of American communities each year. In the end, just 115 were considered rentable. Average and median salaries, travel times, air quality, public school quality, job growth projections, and occupancy rates were just a few of the numerous aspects analyzed by the experts.
- Do you want to buy a house or a new apartment but are worried about the rising mortgage cost and the booming real estate market? It could have a promising future.
- It may take two to five years of saving to afford a home in a top city if you downsize to a one-bedroom apartment, but you could save as much as $3,735 annually by making that move.
- Unlike homebuyers, renters today are much more demanding of their housing options. Experts combed through data from 200 municipalities to find out where occupants of one-bedroom apartments would be best able to put money aside for a down payment.
- One in three people is content with a one-bedroom rental apartment while saving for a house. Thanks to this, they can put away $3,735 yearly on average. This could vary from location to location.
- When it comes to cities where renters can save the most money by downsizing, Chicago ranks fourth, with a two-year-and-three-month time frame to reach the goal.
- New York is one of the few major cities where renters can save $20,000 annually by downsizing, equivalent to a deposit for the next two years and seven months. However, this could make life challenging for New York City tenants confined to small apartments.
Best Places Where Renters Could Save Money
These are the best ten places for renters to save up for a house deposit by moving into a smaller dwelling. This approach can potentially help long-term renters become homeowners in under two years.
Dayton, Ohio
Housing in Dayton, OH, is 26% less expensive than the national average, while utilities are around 4% cheaper. The cost of groceries in Dayton, OH, is around 3% more than the national average, while the cost of apparel is about the same.
- A down payment may be saved in one year and nine months.
- The average cost of a first house is $56,652
- Value of the first payment: $5,765
- Downsizing may save you $3,168 annually.
Philadelphia
Roughly 45 percent of the city’s households are renters. While the national average for rent in January 2021 was $1,465, the average rent in Philadelphia was $1,666. Compared to the typical monthly rent in Manhattan, which is just a little over an hour by train from Philadelphia, this is a significant savings of 51.26 percent.
- Savings required for a down payment: 1 year and 10 months
- The average cost of an entry-level house is $142,288.
- Value of the first payment: $14,229
- Downsizing may provide an annual savings of $7,416.
Jackson, Mississippi
The typical apartment in Jackson, MS, is 933 square feet. However, this may range widely from one form of housing to another, with both modest and extravagant options available. Studio apartments are the smallest and cheapest option, followed by 1-bedroom units that are about average and 2-bedroom and 3-bedroom units that provide much more space.
- The minimum down payment preparation time is two years.
- The average cost of a first-time home is $36,413
- Investing an initial 3,641 dollars: a down payment
- The annual cost savings from downsizing is $1,800.
Chicago
Chicago rents are up 9 percent from a year ago, including new apartments for rent. Chicago’s median rent has been stable over the previous three years. Of all the households in the Chicago metropolitan region, 53% are renters.
- The minimum down payment may be saved in two years and three months.
- The average cost of a first house is $201,848.
- Initial Investment Value: $20,185
- The annual cost savings from downsizing is $8,916.
Tuscaloosa, Alabama
Apart from being the location of the University of Alabama, Tuscaloosa is well-known for its cheap cost of living and inexpensive housing. This Southern jewel is on par with Chicago in terms of how long it would take tenants to save for a down payment on a first house if they downsized by one bedroom:
- Tuscaloosa renters may save enough money for a 10% down payment on a $122,221 starter house in two years and three months if they put away $5,292 each year.
- The minimum down payment may be saved for two years and three months.
- The price of a starter house in the median market is $122,221
- Value of the first payment: $12,222
- There is an annual savings of $5,292 due to depreciation.
Detroit
Like those in many other cities, Renters in Detroit may be able to afford to buy a house by reducing their current dwelling. Savings of $1,956 each year may not seem like much, but the typical cost of a first house in the U.S. is just $45,478. This makes the process of moving in quickly achievable. Like those in Chicago and Tuscaloosa, Renters in Detroit might save enough money for a down payment in a little over two years and three months.
- The minimum down payment may be saved for two years and three months.
- The average price of an entry-level property is $45,478.
- Amount of the Initial Investment: $4,548
- Cost-cutting measures provide an annual $1,956 gain.
Birmingham, Alabama
There’s a good reason why Birmingham, Alabama, is often named among the top 100 best cities to call home in the United States. People who call this city “home” are raving about its improvements to its restaurants, nightlife, sports, music, and employment prospects, making it the best-kept secret in the South.
- The minimum down payment may be saved for two years and six months.
- The average price of an entry-level property is $55,125.
- Investing Value of a Down Payment of $5,513
- Reduced expenses per year: $2,172
New York City
In June, the median monthly rent in New York City was $3,500. The most expensive was Manhattan, where the median price was $4,100, a 39% increase from the previous year.
- It’s now or never for a down payment, which could be saved over two years and seven months
- The median cost of an entry-level house in today’s market is $531,117.
- Value of the initial deposit: $53,112
- Downsizing may save you $20,148 every year.
Conclusion
As a result, there are situations in which relocating to a smaller dwelling, such as a one-bedroom apartment, may free up enough cash for a down payment on a new house within two to three years. It’s an ideal area to set down roots for a young family.