We recently came across a list of the top ten cities ranking places where renting a home or apartment was better than purchasing one. The criteria for the list was rather simple – the cities that had the lowest ratio of average rental price to average home purchase price won a spot on the list.
This got us thinking. What are the most "tenant friendly" cities in the United States? In other words, besides just rental and home prices, what other measurable factors make a city amenable to renters?
Our rental property software experts looked at the 50 most populous U.S. cities and ranked them based on the following criteria:
- Cost per square foot of a 2-bedroom apartment;
- Change in rent prices from 2009 to 2010;
- Residential vacancy rate;
- Rental cost as a percentage of median income;
- Tenant councils;
- Tenant-friendly foreclosure laws; and,
- Rent control laws.
Cities were awarded points based on our methodology below. Based on our analysis, here are the United States' most tenant friendly cities (See all 50 rankings here). We have listed them in order of best to last (i.e. Chicago is ranked #1).
|City||Cost||% Change||Vacancy||% of Income|
This table displays which cities offer tenant councils, foreclosure protection, and rent control. We have provided more details of each below the table.
|City||Tenant Council||Foreclosure Protection||Rent Control|
Here is more about the metrics we used to determine "tenant friendliness."
- Cost per square foot. This number reflects how much a 2-bedroom, 1,000 square foot apartment costs per square foot, per month in a particular area. In order to keep it simple, we used 1,000 square feet across all of our cities to describe a 2-bedroom apartment. Rents are based on Rent-O-Meter's pricing of 2-bedroom units. A point was awarded if the monthly rent was less than $1.10 per sq. ft., which was the median of all 50 cities' rental prices.
- Recent trends of rental prices. This number reflects the percent change in the average rent of a two-bedroom apartment from 2009 to 2010. The numbers come from ApartmentRating.com's What's My Neighbor Pay tool. Any decrease in rental prices earned a city a point.
- Residential vacancy rate. This number reflects the percentage of rental properties that are vacant (as of March 2010) in a particular metro area, as determined by the United States Census Bureau. Approximately 10% vacancy is the national average. A point was awarded if the vacancy rate was higher than the national average, which would benefit tenants.
- Rental cost as a percentage of median income. This number reflects what percentage of a person's annual income is used on rent. Rents are based on Rent-O-Meter's pricing of 2-bedroom units and median income is based on U.S Census data. Cities whose residents spent 30% or less on rent earned a point.
- Tenant councils. This notes whether or not the city has an established, private tenant's council or association to help settle disputes between landlord and tenants, as well as provide advice for tenants on a range of issues. If a city has a private tenant council, they earned a point.
- Tenant-friendly foreclosure laws. The Protecting Tenants at Foreclosure Act (PTFA) of 2009 is a federal law designed to protect the lease of tenants who are living in buildings that are being foreclosed. The legislation left many specifics up to the states. If a state has passed laws that enhance this tenant-foreclosure protection, they earned a point.
- Rent control laws. This metric reflects whether or not a city, town or state has enacted rent control laws. These types of laws are fewer and fewer nowadays, with only a handful of states having them. Those cities that have them earned one point.
Feedback and The Full List of All 50 Cities
If you have any comments or questions about our analysis, please feel free to leave a comment below. We'll be sure to respond quickly.
We've also put our full analysis online, detailing the tenant friendliness numbers for the 50 most populous cities in the United States. If you're moving to an apartment in a new city, you should take a look. If your city is isn't in the top ten, make sure you take a look at our full list to see where it ranks.
You can view the full list of cities here.