While many people still dream of homeownership, it's not financially viable for everyone. Mortgage interest rates are on still on the rise -- right now, the average rate on a 30-year fixed-rate mortgage is 6.81%. This, combined with higher-than-usual inflation rates and limited housing inventory, has led many people to rent rather than buy.
See: More Americans Can Afford To Buy a Home in These 20 Cities
Find Out: 3 Things You Must Do When Your Savings Reach $50,000
According to the United States Census Bureau, 35.4% of Americans are renters. And while some of this may be due to personal preference, the cost of living is almost certainly a factor as well.
The median gross rent in the U.S. was $1,163 at the last census (2017 to 2021) -- in comparison, the average monthly mortgage payment is now $2,317. And even if you live in a state with lower mortgage payments, you still have to factor in things like maintenance costs, property taxes and homeowners' insurance premiums. These things can add up, and quickly.
As a renter, you don't have to worry as much about these unexpected expenses. You also have more flexibility if you want to move somewhere different or pursue a new work opportunity once your lease expires. This is especially beneficial if you haven't yet settled on where you want to live in the long term, or if you're waiting to buy property until the time is right.
If you're a renter, either because you're not interested in purchasing a home or because you can't currently afford it, there are many states in which you can still rent an inexpensive apartment. Using Apartment List's May 2023 rental data, GOBankingRates has curated the following list of cheapest states to rent an apartment in based on the estimated overall typical rental price, as well as the estimated rent for one-bedroom and two-bedroom apartments.
Minnesota
- Estimated rent overall: $1,116
- Estimated for a 1-bedroom: $969
- Estimated for a 2-bedroom: $1,182
Located in the upper Midwest, many parts of Minnesota boast plenty of educational and job opportunities. The state is also known for its low cost of living, which is great if you're living on a strict budget or are still exploring your options.
I'm a Real Estate Agent: Buy Real Estate in These 10 Cities To Be Rich in 10 Years
Mortgage Interest Rate Forecast for 2023: When Will Rates Go Down?
Idaho
- Estimated rent overall: $1,188
- Estimated for a 1-bedroom: $878
- Estimated for a 2-bedroom: $1,122
Idaho offers affordable housing opportunities throughout the state, as well as a lower cost of living than other parts of the country. The state is also renowned for its natural scenery and small-town vibe.
Check Out: Why Retirees Are Expected To Sell Their Homes in These 10 Cities
Wisconsin
- Estimated rent overall: $1,100
- Estimated for a 1-bedroom: $893
- Estimated for a 2-bedroom: $1,117
Offering all four seasons and a low cost of living, Wisconsin is another affordable option for renters. It's also well-known for its diverse food and nature -- not to mention its college sports culture.
Indiana
- Estimated rent overall: $1,102
- Estimated for a 1-bedroom: $894
- Estimated for a 2-bedroom: $1,113
With many small- and mid-sized towns, Indiana has a relatively quiet vibe, which could be good for young families looking for someplace affordable to settle -- at least for a time.
Michigan
- Estimated rent overall: $1,103
- Estimated for a 1-bedroom: $879
- Estimated for a 2-bedroom: $1,126
While some parts of Michigan can be on the expensive side, the state as a whole offers affordable housing for renters. It also has all four seasons and plenty of outdoor recreation.
See: 10 Places To Live Abroad So Cheap You Could Quit Your Job
Nebraska
- Estimated rent overall: $1,070
- Estimated for a 1-bedroom: $898
- Estimated for a 2-bedroom: $1,078
For those looking to escape the big city life, Nebraska has many towns where you can find a high quality of life, and job and education opportunities. It's also one of the more affordable locations to live.
Kansas
- Estimated rent overall: $1,102
- Estimated for a 1-bedroom: $866
- Estimated for a 2-bedroom: $1,091
In Kansas, you can find some of the most affordable housing opportunities in the country. Although the Midwest isn't for everyone, the low overall cost of living may very well make up for it.
Ohio
- Estimated rent overall: $1,075
- Estimated for a 1-bedroom: $844
- Estimated for a 2-bedroom: $1,089
Located between Pennsylvania, West Virginia and Kentucky, Ohio offers a reasonably low cost of living, particularly when it comes to housing. It's also renowned for its natural beauty.
Find Out: 15 Cities Where Houses Are the Best Bargains Right Now
Mississippi
- Estimated rent overall: $1,095
- Estimated for a 1-bedroom: $858
- Estimated for a 2-bedroom: $1,043
Although Mississippi has a higher-than-average poverty rate, the state is still very affordable when it comes to housing and overall cost of living.
Wyoming
- Estimated rent overall: $1,116
- Estimated for a 1-bedroom: $837
- Estimated for a 2-bedroom: $1,046
With low taxes and crime, Wyoming is another solid option if you love the great outdoors and want to rent somewhere that's both affordable and diverse in scenery.
Montana
- Estimated rent overall: $1,073
- Estimated for a 1-bedroom: $828
- Estimated for a 2-bedroom: $1,095
Similar to Wyoming in many ways, Montana also boasts a low cost of living and diverse natural scenery. The state has all four seasons and plenty to do year-round.
Real Estate Transfer: Baby Boomers Secure Generational Wealth by Transferring Property to Children
Oklahoma
- Estimated rent overall: $1,071
- Estimated for a 1-bedroom: $855
- Estimated for a 2-bedroom: $1,053
Known for its small towns, Oklahoma is an inexpensive state, making it a great option for renters and buyers alike.
Louisiana
- Estimated rent overall: $1,044
- Estimated for a 1-bedroom: $887
- Estimated for a 2-bedroom: $1,032
Inexpensive and culturally diverse, Louisiana ranks near the top when it comes to the cheapest states to live in. There may be more limited job opportunities in the more rural areas, but there are still plenty of options in the bigger cities.
Missouri
- Estimated rent overall: $1,043
- Estimated for a 1-bedroom: $837
- Estimated for a 2-bedroom: $1,033
Missouri has a lot to offer when it comes to art, culture and natural scenery. The state is also very affordable when it comes to overall cost of living and rental prices.
Read More: 2023's Housing Correction Could Be The Largest Since Post-WWII
Alabama
- Estimated rent overall: $1,062
- Estimated for a 1-bedroom: $828
- Estimated for a 2-bedroom: $1,017
Located in the southeastern part of the country right along the Gulf Coast, Alabama offers very affordable housing. The state is also known for its great barbecue.
Kentucky
- Estimated rent overall: $988
- Estimated for a 1-bedroom: $793
- Estimated for a 2-bedroom: $972
If you're looking for a state with a small-town vibe, Kentucky could be a good fit for you. Not only do you get that, but you also get all four seasons and a low cost of living.
Arkansas
- Estimated rent overall: $1,008
- Estimated for a 1-bedroom: $767
- Estimated for a 2-bedroom: $974
Home to the Ozarks, Arkansas has plenty of outdoor recreational activities and a thriving education scene. The cost of rent is also low.
Housing Market 2023: Prices Are Now So High That Banks Are Losing Money on Mortgages
South Dakota
- Estimated rent overall: $973
- Estimated for a 1-bedroom: $754
- Estimated for a 2-bedroom: $1,012
With abundant natural scenery, a thriving job economy and cheap rental prices, South Dakota makes the top three on this list for good reason.
Iowa
- Estimated rent overall: $972
- Estimated for a 1-bedroom: $753
- Estimated for a 2-bedroom: $998
Iowa has a mix of rural and urban towns, so there's something for everyone in this state. Plus, Iowa's housing options are very affordable.
North Dakota
- Estimated rent overall: $869
- Estimated for a 1-bedroom: $714
- Estimated for a 2-bedroom: $873
The cheapest place to rent an apartment in the United States is North Dakota. And the low cost isn't just for housing -- the overall cost of living is also on the low side. If you're looking for somewhere affordable with decent job opportunities, this could be the state for you.
More From GOBankingRates
- Suze Orman's Top 26 Tips That Will Save You From Financial Disaster
- Money Expert Jaspreet Singh Says You Can Use ChatGPT To Become a Millionaire -- Here's How
- 3 Ways to Recession Proof Your Retirement
- 55 Easy Ways To Save Money Daily
Methodology: To find the best states for renters, GOBankingRates used Apartment List's May 2023 rental data to find each state's (1) overall estimated typical rent price, (2) estimated rent for a 1-bedroom, and (3) estimated rent for a 2-bedroom. GOBankingRates then scored all states with available data against each other on factors (1-3) and ranked them based on their combined score. No. 1 is the overall best state for renters in terms of affordability. All data was collected on and up to date as of July 6, 2023
This article originally appeared on GOBankingRates.com: 20 Best States for Renters
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
