20 ‘Sweet Spots’ for Renters
Looking for a change of scenery? Many people go (or stay) where their families are, where the jobs are, and where they can afford to live. The tricky part is that the last two factors often conflict: Hot job markets also tend to be hot rental markets, meaning that a greater share of income from places with more plentiful, higher-paying jobs is likely to go toward rent.
Fortunately for those who don’t like their market too hot or too cold, there are just-right “sweet spots” where job and income growth are strong and rents are relatively affordable. [1]
They tend to be mid-sized areas not on the coasts. Atlanta is the largest metro on the top 20 list, followed in size by Minneapolis, St. Louis and Pittsburgh. (As an aside, online betting currently says Atlanta and Austin have the best odds of landing Amazon’s second headquarters.)
Missouri makes the strongest sweet-spot showing with three metros, including St. Louis and Kansas City, in the top 20.[2] Smaller Springfield is the sweetest spot on the national list, with above-average employment and below-average rents. Its top corporate employer is national retailer Bass Pro Shops, according to the Springfield Regional Economic Partnership.
Springfield’s rent affordability is among the best in the country, with the typical rental costing about 21 percent of the area’s median household income. Nationally, the typical rental takes 29.2 percent of the median household income.
Alabama, North Carolina, Ohio, Pennsylvania and Utah each have two sweet-spot metros in the top 20.
Provo-Orem, Utah, stands out for its strong employment base, which continues to grow, while the typical renter pays about a quarter of her income on rent.
Killeen-Temple, Texas, (where Fort Hood is based) and Montgomery, Ala., make the sweet spot list in part because they rank so high nationally for year-over-year income growth – both topping 9 percent according to mid-year data from the U.S. Bureau of Labor Statistics. They also offer typical rentals that cost less than a quarter of their areas’ median household incomes.
[1] The sweet spot list was generated using Zillow’s Rent Affordability Index and information on employment and income from the U.S. Bureau of Labor Statistics’ Current Employment Statistics, State and Metro Area database.
[2] The St. Louis metro shares a border with Illinois, and Kansas City with Kansas.