How Much Does an Apartment Cost?
Looking for a new apartment can be very exciting, yet also a bit overwhelming. Asking yourself “How much should I spend on rent?” and “How much rent can I afford?” is key to a successful apartment search. Understanding “How much is my new place actually going to cost me?” is another important, yet often unconsidered question.
Whether you are looking to rent your first place, moving out of state, or simply ready for a change of scenery, understanding housing costs as well as other expenses associated with moving and renting are key to having a seamless transition into your new home. There are many hidden costs and benefits to renting, so we’ve given you some tips on what you need to be thinking about from the start.
How Much Does an Apartment Cost?
How Much Is Rent in the US?
There are many ways to anticipate how much rent you might pay in a new place, and also to evaluate what kind of deal you might be getting on a prospective unit. Two important metrics to consider are national trends and averages by city and state. Apartment List's National Rent Report is a great place to get a general sense of what you can expect to pay this year, and how it stacks up to previous years.
National Trends in Rent
According to Apartment List's National Rent Report,
- In 2023, apartment vacancies returned to pre-pandemic levels.
- In August 2023, rent was down year over year in 73 of 100 of the largest cities.
- Between 2018 and 2022, rental prices grew in August of each year, except in 2023, when they fell 0.1%.
- In the Midwest and Northeast, rent prices have bucked the national trend by continuing to grow.
- The top four cities with the slowest or negative growth were Portland, Miami, Austin, and Phoenix.
Rent Prices by City
Average rent by city is a very useful metric to examine when you want to get a real-world sense of what an apartment costs. For instance, Cleveland OH had the lowest average rent for a 2-bedroom in August 2023 at $788 a month. By contrast, Marina del Rey, CA cost renters an average of $5,162 in the same month for a 2-bedroom. This profound variation by locality shows why prices by city offer the most realistic estimate for apartment hunters.
Apartment List offers detailed reports for over 30 major cities, which you can find linked in our National Rent Report. Each of these has an easy to view snapshot of median and average rent.
Additionally, our Data & Rent Estimate Reports offer estimates at the state, city, and county levels for a much larger number of localities. By clicking the link above, you can download reports about
- Historic Rent Estimates (1 br, 2 br, overall)
- Historic Rent Growth (1 br, 2 br, overall)
- The Apartment List Vacancy Index
What State has the Most Expensive Rent?
According to our Historic Rent Estimate report, Hawaii, California, and the District of Columbia were the three most expensive states for rent in August 2023. Renters in August paid an average of $2,418 in Hawaii.
What State Has the Least Expensive Rent?
According to Apartment List's rent estimate report, North Dakota, Iowa, and South Dakota had the lowest rental prices in August 2023. The average cost of rent in North Dakota for that month was $880.
What City Has the Highest Rent?
In August 2023, Marina del Rey, CA; Hoboken, NJ; and Foster City, CA were the three most expensive cities to rent in. On average, renters paid $4,703 in Marina del Rey that month.
What City Has the Least Expensive Rent?
Cleveland, OH; Lake Charles, LA; and Odessa, TX were the most affordable cities for rent in August 2023. Renters in Cleveland, OH paid an average of $775 that month.
The 30% Rule
So how much should you spend on rent? The most common guideline for renting is to spend approximately 30% of your gross monthly income, i.e. your paycheck before taxes are taken out, on rent. If your rent payments exceed the recommended 30% of your gross household income, you are considered cost-burdened.
If it is hard for you to calculate how much you make every month, but you have a better idea of how much you make a year, then you can divide your annual salary (again, before tax income) by 40. You’ll come out with the same number either way!
Even better, we’ve made a rent affordability calculator tool for you that will do the hard work for you. Plug your monthly income into the calculator and we will help guide you to an answer on how much rent you can afford.
| Annual Income (before taxes) | Monthly Income (before taxes) | Budget at 30% | Max Approved at 2X | Max Approved at 3X |
|---|---|---|---|---|
| $20,000 | $1,667 | $500 | $833 | $556 |
| $40,000 | $3,333 | $1,000 | $1,667 | $1,111 |
| $60,000 | $5,000 | $1,500 | $2,500 | $1,667 |
| $80,000 | $6,666 | $2,000 | $3,333 | $2,222 |
| $100,000 | $8,333 | $2,500 | $4,167 | $2,778 |
| $120,000 | $10,000 | $3,000 | $5,000 | $3,333 |
Evaluate Your Financial Situation
The issue with the 30% rule is that it doesn’t take in consideration your unique financial situation. If you are up to your neck in high-interest student loan debt, you might have to prioritize paying those off. Therefore, you may want to spend less than 30% of your gross income on rent.
If you make $10,000 a month, that doesn’t mean you have to spend $3,000 on rent. Your financial goals should also play a role in determining your monthly rent allowance. If you want to contribute more to investments or 401K, lowering that 30% to 25% or even 20% might be a good idea. In this case you might also want to consult a financial advisor.
Factor in Income Requirements
Knowing how much you can spend on rent from a budgeting perspective is the first step in finding a place you love and can afford. However, before you start your search it is also important to know that many landlords and property managers require a renter’s monthly income to be 2-3 times the rent to qualify for an apartment.
This income requirement is normally an aggregate requirement for all occupants in a rental, so if you are moving in with a significant other or roommate the two of you combined must meet this minimum.
Moving and Move-In Fees
You’ve found the perfect apartment, you can afford the rent, and it has great amenities! Then all the fees of moving in start piling up, and your budget is on the fritz. Keeping these common moving and move-in fees in mind can be really helpful to make sure you’re financially prepared for your big move.
Below are our guidelines, but always make sure you double check any fees before signing you lease. Here are the most common apartment moving and move-in fees:
Security Deposit
Putting down one month’s deposit, i.e. the amount you pay for rent in a given month, is very standard. Sometimes rentals will require first and last month’s rent along with a security deposit. Keep in mind, a deposit is just that – you should get it back once you move out as long as your place is clean and nothing major is broken.
Application Fees
Paying to submit your application is a common practice for rentals – it helps ensure only serious renters apply. Fees range all over the place, and can be per application, per person, or completely waived.
Average Application Fees
According to our data, the average application fee is $50. Application fees range as indicated in the chart below.
Pet Fees and Deposits
Moving with a pet can be costly, so it is important you understand all the fees up front. These can range from a pet deposit, which you should get back when you move out, to monthly pet rent, which you pay every month so your furry friend can enjoy living in your apartment as well, to a non-refundable pet fee, which is a one time cost for letting your pet move in with you. Make sure to ask about all fees so there are no surprises if you are bringing Fifi or Fido along. For more details check our article on finding a pet-friendly apartment.
Average Pet Deposits
40% of apartments that are pet-friendly require a deposit. The average pet deposit is $292.
These fees range, depending on the apartment. Check out the data below!
Moving Fees
While not directly tied to your property, all the money you pay to move can really add up. Using movers? They can cost hundreds of dollars. Getting new furniture? Even Ikea pieces can cost a pretty penny. And don’t forget about all the spices, Tupperware, cleaning supplies and other little things you decide you don’t need to pack up and bring with you but now need to buy again.
While not directly tied to your property, all the money you pay to move can really add up. Using movers? They can cost hundreds of dollars. Getting new furniture? Even Ikea pieces can cost a pretty penny. And don’t forget about all the spices, Tupperware, cleaning supplies and other little things you decide you don’t need to pack up and bring with you but now need to buy again.
Hidden Benefits and Costs
Knowing how much you can afford to spend every month on rent is essential to finding your next home, but most renters forget to consider the true costs of renting.
What do we mean by this? We mean the additional living expenses, costs or benefits a renter incurs by choosing to live in a specific place. These costs can add up and make a significant impact on personal finances in the long run, so factoring them into your choice at the start can save you lots of money and stress.
We cover a few of the costs that are worth considering when choosing an apartment complex below:
Commute
Time is money, and most adult Americans spend at least some time commuting to and from work each day. Nationwide, one in 36 commuters travel more than 90 minutes one way to get to work, and these super commuters are on the rise, up 15.9% from 2.4% in 2005 to 2.8% in 2016. This means nearly 4 million people across the US are spending hours commuting every day.
Finding a home close to work can save you hours in the car, leaving you with more personal time to enjoy your home, family, and friends.
Transportation
Proximity to public transportation is another factor many renters should consider when choosing a place to live. If taking public transportation is your main mode of getting around, how close you live to a bus, subway, or bike share can be a huge perk, or downside if you’re far, to your new apartment.
Even if you own a car, knowing that you have options for getting from A to B can be a value-add for any rental.
Parking
If you have a car, you know it isn’t cheap, and you want to take care of it. Having a designated parking spot or covered garage can bring peace of mind to car owners, and should be a factor in deciding which place is best for you when you move.
If you live somewhere where parking isn’t a problem and cars are safe on the streets, this may be less of a concern, but if you live in a crowded metropolis parking with your apartment could be a big plus. Paying for a parking spot can also be expensive, costing several hundred dollars a month in some cities, so when it is included as part of rent this can be a significant financial benefit.
Amenities
Some apartment communities offer an extraordinary amount of amenities. Want to lay out by a pool on the weekends? Check. Need a quick workout in the mornings? Check. Want to host a barbecue for all your friends? Check. While these amenities might seem like the icing on the cake for your rental, they actually might be saving you lots of money as well.
Gym memberships are often expensive and fees recur on a monthly basis. Unless you have a free public pool nearby access to a country club or other private pool can be costly. Finding a space to rent for a party is never cheap.
Having awesome amenities at your disposal for free can not only cut decrease your living expenses and help you save money, but the convenience of such amenities might also encourage you to use them more often than you would otherwise.
Schools
For parents and students alike, being close to school makes life so much easier. Whether proximity lets you roll out of bed right before class or save time dropping the kids off in the morning, it’s a big benefit.
If your children attend public school, making sure your new place is in the district of your choice or on the school bus route can also be a big factor in choosing a home that, while doesn’t impact your rent, can have a huge impact on you and your family’s life.
Renovations
Sure, old building have charm and character that newer builds sometimes lack. Plus when you’re renting your landlord takes care of maintenance and fixing broken appliances, right? While this is normally true, dealing with old plumbing, broken washing machines, failing fixtures is a huge pain. Your landlord might be busy, or slow to respond.
Finding a place with new appliances or that has been recently renovated can help alleviate some of this frustration, and is worthwhile to keep in mind. At the very least, make sure to check all the appliances at your new place thoroughly before signing a lease.
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Additional Resources
Rent Calculator
Finding an Apartment: 8 Apartment Hunting Tips on a Budget
First Apartment Budgeting Checklist
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