How Rent Can Play a Role in Your Credit Score

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Building credit can be a frustrating endeavor for many: Too short a credit history or too low a score, and you’re bound to be excluded them from many lending opportunities.

At the same time, it’s a truism that one of the very best ways to build credit is to use credit. This gets complicated, though, for those struggling to stay on top of loan payments or even get approved for credit because their credit file is too thin.

One potential answer? Some consumer advocates are pressing landlords to report tenants’ on-time rent payments to the credit bureaus.

In recent years, property management companies and landlords across the country have individually started using electronic payment services that let tenants have their payment information reported to credit agencies including the big three: Equifax, Experian and TransUnion.

It’s still a long way from a ubiquitous practice, but it is catching on.

Recently, the New York City Comptroller’s Office issued a proposal to give all New York tenants the opportunity to add their rent payments to their credit reports using an opt-in system. (Some two million households in the city pay rent every month.)
Through the proposed program, the city hopes to improve economic opportunities for renters, especially those lower-income residents with poor credit or no real credit history facing limited access to common financial services.

For people who may have a thin credit file, or whose negative credit behavior has dragged down their scores, adding rent payment information to credit reports could be a welcome boost. An estimated 76 percent of New York City renters who have chosen to report their rent payment to credit bureaus will see their credit scores improve by more than 11 points, according to the Comptroller’s Office. Many others might not see a numerical change, but would nonetheless add depth to their credit histories, the office added.

A 2014 TransUnion report suggested that eight in every 10 subprime consumers — whose who may be considered having higher credit risks — experienced an increase in their score one month into their new apartment lease.

Of course, the opposite might be true if tenants slip up and miss a rent payment or pay late. Credit expert John Ulzheimer cautions that this practice may hurt some consumers as much as it might help others. He calls the report’s 11-point increase findings “purely speculative.”

“This is another example of government not truly understanding the mechanics of the consumer credit reporting system and the potential downside to such a mandate,” Ulzheimer tells MagnfiyMoney. “The presumption is that rent will always help someone. That’s without basis.”

However, there’s evidence that reporting rental payments to credit bureaus might encourage renters to stay on top of their payments.

In a 2015 study of a rent reporting pilot program, researchers found rent reporting led to a higher timely rent payment rate among residents. The majority of the participants in the pilot program of more than 1,250 residents saw their credit scores increase, though 14 percent of them didn’t experience any change, and another 7 percent even experienced a drop. The study was piloted by Credit Builders Alliance, a national nonprofit dedicated to helping low- and moderate-income households and businesses build credit and financial access.

How to report your rent payments to credit bureaus

Get your landlord involved. If you are renting, ask your property management company or landlord about whether rental data is being reported to credit bureaus. Some may work with rent payment services that share information to some or all of the three major credit reporting bureaus and some pay a fee — if there is one — so that it’s free for tenants. These services allow landlords to collect rent electronically. They also give renter the option to report his/her payments to credit agencies.

Take matters into your own hands. If your landlord or property manager doesn’t report rental data, urge him or her to do so. Meanwhile, you can enroll in a rent payment service yourself. With some services, you can tell the agency the rent amount and its due date. And the firm will deposit the money into the bank account of your landlord or property manager for you. With others, they don’t process your payment, but only verify your rent history with your landlord and do the rent reporting. Just watch out for fees, as they will might charge registration, wire transfer or other fees for paying via credit or debit.

The list of agencies below report rental data to credit agencies, with a cost ranging from free up to $10 per month. You will have to opt in for credit reporting. Some report payments to all three credit bureaus, and others only do so with one.

Company

Who signs up?

Fees

Which credit bureaus
they report to

RentTrack

Renter

$6.95 for payments made
via ACH transfer
2.95% per credit card payment
2.75% per debit card payment

 
 

Rental Kharma

Renter

Sign-up fee: $25 per person

$6.95 per month for ongoing reporting

Rent Reporters

Renter

Sign-up fee: $94.95 per person,
$9.95 per month for ongoing
reporting

ClearNow

Landlord

Free

PayYourRent

Landlord

$9.95 per month
2.75% per credit card payment

 
 

RentPayment

Landlord

$4.95 per eCheck
2.95% per credit card payment
0.95% per debit card payment

PayLease

Landlord

$0-$9.95 per eCheck
(Rate set by the property
management company)
3.5% per credit/debit
card payment

 

eRentPayment

Landlord

$3 per transaction
Or $10 per month (up to 5 transactions)

 

Rentler

Landlord

$1.95 per transaction
2.9% per credit card payment
1.9% per debit card payment

Should you pay to have your rent payments reported to credit bureaus?

As you can see from the table above, there are a few services that allow tenants to take the initiative on reporting.

But the cost might not be worth the potential benefit. Rent Reporters, for example, charges a hefty sign-up fee just shy of $95. On top of that, you’d have to pay close to $10 each month for ongoing reporting.

There may be other better low-cost ways to improve your credit:

Applying for a secured credit card
To open a secured credit card, you have to provide the bank with a deposit (typically $200 or more). The bank will keep the deposit as collateral and give you a credit limit equal to your deposit. Once open, this card works just like any other credit cards. Your credit limit, balance and payment information are reported to the credit bureaus. But if you don’t pay your credit card on time, the bank can take your deposit and apply it toward the debt.

Check out our secured credit card database here.

Getting a store card
You might have been asked if you’d like to open a credit card at various department stores. Those store cards usually come with really high interest rates, but there is a big perk: Approval of people with low credit scores is more likely. Once you get a store card, make sure you only use it to make one small purchase a month and pay it off on time and in full. If you find it difficult to resist temptation, unsubscribe to emails about deals and don’t even carry your plastic around with you.

Opening a college credit card
If you are a college student, you can apply for a credit card, perhaps by having a parent co-sign, or take out a loan to help cover education costs. You can find a list by filtering for college students on our Cash Back Rewards page.

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7 Monthly Bills Affected by Your Credit

A high credit score helps you in many ways, including by potentially lowering your monthly bills.

You probably know your monthly bills can impact your credit, as late payments or accounts in collections can land on your credit report and bring down your credit score. But are you aware your credit score can affect the payment amount on a number of your monthly bills?

Here are seven monthly bills with payments your credit score can determine.

1. Rent Payments

When you apply for a lease, your landlord might request a background check that includes your credit report. They can’t run a background check without your permission, although refusing may prevent you from moving forward with the lease.

According to the Federal Trade Commission (FTC), the landlord can take adverse action if they find red flags in your credit report. This action could include denying your rental application or raising your rent higher than they would charge another applicant. The good news is they are legally required to give you written notice if they take adverse action, provide you the report they used (if you request it within 60 days) and give you the chance to dispute the information.

2. Credit Cards

Consumers with good credit tend to qualify for much lower credit card interest rates than those with poor credit. Interest is applied to your credit card balance each month unless you pay it off in full within the monthly grace period. (You can go here to learn more about how credit card interest is calculated.) If you tend to carry a balance month to month, your poor credit could be costing you extra in interest.

3. Mortgages

Your mortgage payment is also directly affected by your credit. Mortgage lenders consider you a riskier borrower if you have a lower credit score. To hedge against that risk, they will charge you a higher interest rate.

4. Auto Loans

Credit scores impact the interest rate lenders offer when you apply for an auto loan. While interest rates vary between lenders, having excellent credit generally results in lower interest and a lower monthly payment. Those 0% financing offers you see on car commercials usually require excellent credit.

5. Student Loans

Your credit score doesn’t generally affect federal loan payments, but if you plan on financing your education through private loans, lenders can use your credit score to determine your interest rate and fees. The worse your credit, the more interest you’ll pay on the loan.

6. Auto Insurance

According to The Zebra’s State of Auto Insurance Report, there’s a correlation between credit and car insurance rates. On a national level, drivers with poor credit can pay more than twice as much as those with excellent credit for insurance. Some states have banned insurance providers from using credit scores to determine rates, but it’s a common practice in the states that allow it.

7. Homeowners Insurance

Insurance companies use credit-based insurance scores to determine what you’ll pay for homeowners insurance. These scores are industry-specific and aren’t exactly the same as your credit score, but they use the information in your credit report to determine your score. The same negative marks that bring down your credit score can impact your insurance score, and affect your payment.

Given your credit’s affect on nearly every bill in your mailbox (among other things, of course), it’s important to regularly monitor your credit for errors (you can go here to learn how to dispute those), identity theft or legitimate negative items that are affecting your score. You can pull your credit reports for free each year at AnnualCreditReport.com and view your free credit report snapshot every month on Credit.com. You can generally improve your bad credit by paying down high credit card balances, shoring up accounts in delinquency and limiting new credit inquiries while your credit score rebounds.

Trying to lower your monthly bills. We can help you get started with 9 ways to lower your monthly mortgage payment. 

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The Most Expensive Zip Codes for Renters

When it comes to saving money on rent, ZIP code is everything.

Using data from rental market research firm Yardi Matrix, rental listing service RentCafe analyzed how the cost of renting differs by ZIP code in 125 major U.S. metro areas.

The top 10 most expensive ZIP codes are located in just two cities — New York and San Francisco. In fact, Manhattan and San Francisco took all but one of the top 20 spots in the RentCafe ranking. New York City alone is home to 27 of the top 100 most expensive ZIP codes.

The priciest pads are located in Manhattan’s Battery Park Ball Fields (10282), where renters pay an average $5,924 per month, making it the most expensive ZIP code in the country.

Right behind Battery Park were the Lenox Hill area (average rent: $4,898) and apartments on the Upper West Side near Lincoln Square (average rent: $4,892), which took the No. 2 and No. 3 slots on the most expensive list.

San Francisco had two in the top 10: ritzy neighborhoods Presidio and Main Post (94129), where average rental prices stand at $4,762, and the city’s South Beach area (94105) pulled in ninth at $4,380.

According to the ranking, Boston was the third most expensive city for renters. There, renters can expect to pay $4,227 to live in the city’s most expensive ZIP code, the Black Bay neighborhood (02199).

MagnifyMoney looked at RentCafe’s findings to figure out which cities had the most expensive ZIP codes. Here’s how they stacked up:

Ranking

City State Most Expensive ZIP Code

Average Rent

1 Manhattan NY 10282 $5,924
2 San Francisco CA 94129 $4,762
3 Boston MA 02199 $4,227
4 Palo Alto CA 94301 $3,718
5 Menlo Park CA 94025 $3,657
6 Brooklyn NY 11201 $3,622
7 Los Angeles CA 90401 $3,477
8 Santa Monica CA 90405 $3,423
9 Durham NC 03824 $3,381
10 Playa Vista CA 90094 $3,367

How to save on rent

Always comparison shop.

Comparison shopping is one of the most important things you can do to save money on your next move. Comparing prices in and around the area you want to live is one way to make sure you pay a fair price for your new space.

Back in the day, comparing prices on apartment would have involved calling several different management companies to compare quotes. Even then, you might have missed a good deal. With today’s technology you can (and should) easily search for and compare rent prices all over the world with interactive maps on sites like RentCafe, Apartment Finder, or Cozy.

Fly South for lower rent

Renters looking to pay as little as possible should look toward southern states like Kansas or Alabama. Two Wichita, Kan., ZIP codes (67213 and 67211) priced around $400 per month, while apartments in Decatur, Ala. (35601) will run renters on average $458 per month. So, for what you’d pay for one month of rent in Manhattan, you could rent a place in Kansas for a whole year.

Below are the top ten cities with the least expensive rental listings based on Yardi Matrix data.

Ranking City State Least Expensive

ZIP Code

Average Rent
1 Wichita KS 67213 $407
2 Decatur AL 35601 $458
3 Memphis TN 38106 $464
4 Columbus GA 31903 $482
5 Fort Wayne IN 46809 $495
6 Huntsville AL 35810 $503
7 Louisville TN 37777 $507
8 Gravel Ridge AR 72076 $508
9 West Memphis AR 72301 $508
10 Athens AL 35611 $510

 

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Buying a House? You May Want to Avoid the 30% Rule

The 30% rule is a good place to start, but it’s not always the best gauge of how much should you spend on housing.

Ask someone the question, “How much should I spend on a house?” and there’s a good chance that they will respond with the 30% rule.

The 30% rule, which says not to spend more than 30% of your income on housing, is a good place to start, but it’s not always the best gauge of how much should you spend on housing. You don’t want to base your entire financial situation on it — especially since it’s not exactly clear what that 30% includes.

What Is the 30% Rule?

The 30% rule has been around since the 1930s, according to the Census Bureau. Back then, policymakers were trying to make housing affordable. They came up with the idea that you could spend about 30% of your income on housing and still have enough left for other expenses.

Over time, those numbers started to get used in home loans as well. A rough sketch of what you could afford, in terms of monthly payment, could be obtained by estimating 30% of your income.

Is the 30% Rule Right for You?

When deciding on your own 30% rule, it’s probably a good idea to base it on your take-home pay, rather than your gross income. Let’s say you bring home $3,500 a month. According to the 30% rule, that means you shouldn’t spend more than $1,050 on your housing payment.

Some folks like to use their gross income for this calculation, but that can get you into trouble in the long run. If you base what you spend on housing on an amount that you might not be bringing home, that can stress your budget.

Think about it: If your pre-tax pay is $3,800 a month, that lifts your max housing payment to $1,140. That’s $90 more per month. But the reality is that you are bringing home $300 less than your gross income. Trying to come up with another $90 a month could put a strain on your budget.

Don’t Forget About Extra Costs

You can use a mortgage calculator to figure out how much you should spend on housing. However, such calculators typically just include principal and interest. This doesn’t take into account other monthly homeownership costs.

If you’re thinking of buying an expensive house, don’t forget about other costs like insurance and taxes.

Experts suggest that you base your 30% figure on all your monthly payment costs, not just the principal and interest.

What Percentage of Income Should Be Spent on Housing?

But it goes beyond that for some homebuyers. When looking into buying a home or an affordable place to rent, don’t just base your estimates on your monthly payment. You should also include estimated utility costs and an estimate for maintenance and repairs.

HouseLogic suggests you budget between 1% and 3% of your home’s purchase price annually for repairs and maintenance. I like the idea of budgeting 2%. So, on a $200,000 home, that means you can expect to pay $4,000 for repairs and maintenance — about $333.33 per month.

Once you start adding in all the other aspects of homeownership, suddenly that 30% rule is less cut-and-dry. If you’re more conservative, adding up all the monthly costs of homeownership and keeping it all under 30% makes sense.

You’re less likely to overspend that way. But it might mean a smaller, less expensive home.

Consider the 28/36 Qualifying Ratio

Instead of relying on the 30% rule to answer the question, “How much should I spend on a house?”, consider using the 28/36 qualifying ratio.

According to Re/Max, many lenders use the 28/36 rule to figure out whether your finances can handle your home purchase. The 28 refers to the percentage of your gross monthly income that should be spent on your monthly housing cost. The 36 refers to the percentage of income that goes toward all your debt payments, including your mortgage.

So, if you make $3,800 in take-home pay, your monthly payment should be no more than $1,064. But, things get stickier when you calculate the 36% part of the ratio. Your total debt payments shouldn’t exceed $1,368. That leaves you about $304 for payments of other debts.

Let’s say your credit card and auto loan payments total $500. That means you’re going to have to adjust your expectations for what you can expect to pay for a mortgage. In fact, if your lender insists on the 36 part of the ratio, you have $196 less you can spend on your mortgage payment. And that might mean a less expensive house.

When figuring out what percentage of income you should spend on housing, base the calculations on your take-home pay. Even though Re/Max says many lenders use your gross pay for the 28/36 qualifying ratio, this way you’ll play it safe.

How Much Should I Spend on a House?

Everyone has to answer the “How much should I spend on a house?” question for themselves. However, the biggest reason to ditch the 30% rule is that you might not be comfortable with it.

Are you really comfortable spending 30% of your income each month on your housing? When you consider your other payment obligations, does it makes sense for you to spend so much on housing?

If you aren’t sure about the 30% rule, use your own rule. You might be more comfortable with 25% on all of your housing costs. Or perhaps you modify the rule. Maybe you spend 20% on mortgage and interest and keep your total housing costs to 25% or 28%.

No matter what you decide, the important thing is to be responsible with your finances. Only spend what you feel comfortable with on housing or rent.

Image: Portra

The post Buying a House? You May Want to Avoid the 30% Rule appeared first on Credit.com.

If You’re Having Trouble Finding a Cheap Apartment, Here’s Why

trouble-finding-a-cheap-apartment

Whether you’re browsing the local paper or using one of the many apartment listing apps out there, finding a decent place to hang your hat that’s also in your budget can feel like trying to uncover the the lost city of Atlantis.

Turns out, there’s a reason for that, according to a new analysis conducted by Zillow.

The real estate company used information from their database to analyze median rents in 15 major housing markets in the U.S., as well as the number of apartments built in the past 3 years. From this, they discovered the median rent for the least expensive third of apartments outpaced the overall rental market. Also, most new apartment growth is comprised of luxury units for wealthy renters.

In layman’s terms, there is growing demand for affordable rentals, but instead of meeting that need developers are focusing on adding to the supply of luxury units, pushing apartment rent prices higher across the board.

“We’re simply not building enough at the bottom and middle of the rental market to keep up with demand,” Svenja Gudell, Zillow’s chief economist, said in a press release. “As a result, these segments are becoming very competitive, as both new renters look to find their first place and existing renters get shut out of homeownership because of extremely limited for-sale inventory. Apartment construction at the low end needs to start ramping up, and soon, in order to see real improvement.”

By the Numbers

This is playing a major role in property affordability, according to Zillow, and is especially affecting lower-income Americans who are likely to rent. Below are the findings for the 15 cities Zillow analyzed.

ZillowChart

Before Renting Your Apartment

As you search for your next place to call home, it’s important to remember that any potential landlord is probably going to look at a version of your credit report as part of your application. You may want to consider reviewing your credit before you apply so you have an idea of where it currently stands. (You can see your free credit report summary, updated each month, on Credit.com.) This will help you get a better idea of what terms and conditions you may qualify for on a mortgage, as well as if there’s any credit repair work you may want to do before applying for a new rental.

Image: freemixer

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I Don’t Need a Credit Card But Want to Build Credit. What Can I Do?

build_credit_without_credit_card

Good credit is essential if you hope to borrow money one day for things like a new car or home. But good credit can also be important for smaller things like renting an apartment or even landing a new job. And one of the easiest ways to build the credit necessary for these things is by getting a credit card.

If you have no credit, or even bad credit, and you’re averse to getting a secured credit card to help improve your credit, there are other ways to go about establishing and building good credit.

Here are three other options for building credit and improving your credit scores.

1. Get a Credit-Builder Loan

A credit builder loan is a loan with a set amount you pay back over a set period of time (referred to as an installment loan). Most have repayment terms ranging from six months to 18 months, and because these loans are reported to one or more of the three national credit reporting agencies, on-time payments will help build up your credit.

Here’s how it works: A lender places your loan into a savings account, which you can’t touch until you’ve paid it off in full, allowing you to build credit and savings at the same time. And because loan amounts for credit builder loans can be quite small (just $500) it can be much easier to make monthly loan payments.

Credit-builder loans are best for people with no credit or bad credit. But, if you have good credit but don’t have any installment accounts on your credit report, a credit-builder loan could potentially raise your score since account mix is another major credit-scoring factor.

2. Pay Your Rent 

If you’re in the process of moving or need to do so in the near future, it’s a good idea to find a landlord who reports your rent payments to the major credit bureaus. Depending on what credit report or credit score is being used, these on-time monthly rent payments can give you a quick and easy credit reference and help you qualify for a loan (or at least another apartment down the road).

3. Become an Authorized User

Asking your spouse, partner or even your parent to add you onto one of their accounts as an authorized user could give your credit a boost. If the account they put you on has a perfect payment history and low balances, you’ll likely get “credit” when that account starts appearing on your credit reports. You won’t necessarily need to use the card to benefit from this strategy. It is a good idea to have your friend or family member check with their issuer to be sure that it reports authorized users to the three major credit reporting agencies (not all do).

Remember, one of the most important things in building good credit is making timely loan and bill payments. Bills like rent or utilities may not be universally reported to the credit bureaus, but if they go unpaid long enough, they can hurt your credit, especially if they go into collection. (You can see how any collections accounts may be affecting your credit by viewing your two free credit scores, updated each month, on Credit.com.)

If your credit is in rough shape, due to a collection account or other payment history troubles, you may be able to improve your scores by paying delinquent accounts, addressing high credit card balances and disputing any errors that may be weighing them down. And remember, you can build good credit in the long term by keeping debt levels low, making timely payments and adding to the mix of accounts you have as your score and wallet can handle it.

[Offer: If you need help fixing your credit, Lexington Law can help you meet your goals. Learn more about them here or call them at (844) 346-3296 for a free consultation.]

More on Credit Reports & Credit Scores:

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An Entry-Level Salary Is Barely Enough to Make Rent in These Cities

After you land your first job out of college, you’re likely going to be happy about your new steady income and a start to your career. But if you’re in one of the 10 most popular cities for millennials, your starting salary may barely be covering your rent, leaving very little left over for other living expenses, savings and paying off student loan debt.

As major American cities continue to boom, rent costs are skyrocketing. And with the expected more than 1.8 million students graduating with a bachelor’s degree this month, the competition for affordable housing is only getting fiercer.

The mobile apartment and rent payment provider, RadPad, analyzed more than 150,000 apartment listings posted from September 2015 to April 2016. From there, they established what percentage of a monthly, entry-level salary college grads can expect to pay in rent for a one-bedroom apartment in 10 of the most popular American cities.

In New York, for example, the median rent for a one bedroom is $3,000/month. The average entry level employee has to budget rent on an annual salary of $47,000/year, accounting for 77% of their income, RadPad found. In San Francisco — the most expensive city in the study — an entry level employee can expect to pay an astounding 79% of their income.

Just one of the 10 most expensive cities — Houston — comes in under the 30% threshold income rule of thumb for rental spending. Paying less of a percentage of income on rent can help you maintain better control of your finances and establish better savings and spending habits. Austin and Atlanta are also on the end of more affordable cities on the list, but both have rents with an average of 6% above the recommended 30% of average income.

Here’s how each of the 10 cities measured up, ranked from highest percentage to lowest percentage of starting monthly income.

  1. San Francisco — 79%
  2. New York City — 77%
  3. LA — 61%
  4. Boston — 56%
  5. Seattle — 51%
  6. Chicago — 47%
  7. Orlando — 44%
  8. Atlanta — 36%
  9. Austin — 36%
  10. Houston — 29%

Aside from proving proof of income, potential landlords will want to run a credit check. Addressing any inaccuracies or knowing any areas that need improvement can help renters better prepare for their apartment search. To get started, you can view two of your credit scores for free each month on Credit.com. You can also find a list of the most affordable cities in the U.S. here.

[Offer: If you’re trying to rent an apartment, worried about errors on your credit reports, and you don’t want to go it alone, you can hire companies – like our partner Lexington Law – to manage the credit repair process for you. Learn more about them here or call them at (844) 346-3296 for a free consultation.]

More on Managing Debt:

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Why You Can’t Afford All the Cool, New Rental Properties

high_rise

More and more apartment buildings are popping up in cities around the country, but that doesn’t mean they’re getting more affordable. A large number of these developments are very upscale, aimed at people who can afford some serious luxury.

That’s the finding of a recent study conducted by RENTCafé, a nationwide apartment search website.

The study found that 3-in-4 new apartment developments built in 2015 were high-end rentals, and that luxury construction was up 63% overall from 2012. In absolute numbers, that translates to 896 luxury multi-family projects of 50+ units (out of a total of 1,188 total projects) completed in 2015, according to RENTCafé, compared to 382 luxury multi-family projects of 50+ units completed three years prior.

Early 2016 data shows no slowdown in luxury apartment development, with 79% of all apartment buildings finalized in the first quarter of 2016 being categorized as luxury.

Renting: The New American Dream?

A 2015 report by the Urban Institute projected that even after the housing crash and the Great Recession are a distant memory, homeownership rates in America will continue to decline.

The report estimated that between 2010 and 2030, the majority (59%) of the 22 million new households that will form will rent, while just 41% will buy their homes.

The homeownership rate has been falling since 2006, when the housing bubble began pricing out many would-be homeowners — and the recession furthered that trend. In 2006, the homeownership rate was 67.3%; it now sits at 63.6%, even lower than it was in 1990, according the U.S. Census’ most recent American Community Survey.

Where Luxury Grows Fastest

Given those statistics, it’s no wonder developers are focusing on rentals with amenities that typically far surpass those available in starter homes. The highest percentages of high-end rentals were registered in the Southwest and the Mid-Atlantic (88% of the total number of large rental developments), and in the South and Southeast (78%), the study showed. The lowest numbers were registered in the Pacific Northwest (61%), in California (65%) and in the Northeast (65%), where the leading metro markets are more mature.

high_end_rentals

Luxury apartment construction is on the uptick in all regions in recent years, however. The most significant increase from 2012 to 2015 in the ratio of high-end to total new apartments was in the Southeast, up by 119%. Over the same period of time, in the Pacific Northwest the numbers went up 90%, and in California 82%, the study showed. The lowest increase in luxury construction was registered in the Northeast – only 23% up from 2012, and in the Mid-Atlantic – 26% up from 2012.

Even with the spike in luxury apartment development, there are still cities where renting is becoming more affordable. Check out our roundup of 9 cities where rent is getting cheaper this year. Six metro areas that aren’t on that list, however, really stood out when it comes to luxury developments:

  • San Antonio, Texas, where 17 out of 17 properties that completed construction in 2015 were luxury.
  • Kansas City, Missouri, where 14 out of 14 properties completed were luxury, with an average monthly rent of $1,055, versus the metro average of $850.
  • Milwaukee, Wisconsin, where 10 out of 10 large properties opened in 2015 were all classified as high-end with the average rental rate of $1,367 per month.
  • Midland-Odessa, Texas, where 9 high-end properties were completed, charging an average monthly rent of $1,501, which is $402 more than the overall average rent.
  • Jacksonville, Florida, with 7 of 7 properties completed were high-end, with average rents of $1,055.
  • Oklahoma City, Oklahoma, also with 7 out of 7 properties completed in 2015 being high-end rentals with average rents of $1,090.

Finding a home or apartment to rent can sometimes be complicated, especially if you have no credit or a bad credit history. Before you start searching for a new place, get an idea of where you stand — you can get a free credit report summary every 30 days on Credit.com — and consider trying to improve your credit before you look for a new home. If that’s not an option, you may be able to find a broker or apartment-finding agency that can help you find landlords willing to work with bad-credit applicants.

More Money-Saving Reads:

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Financial Stress: What You Can Do to Ease the Tension

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The True Cost of Living in America: Kansas City

When the Kansas City Royals won baseball’s World Series in November, much of small-town America was rooting for them. The small-market Royals had been terrible for decades, unable to compete with big-money teams like the New York Yankees. So while rivals from Los Angeles, New York, San Francisco, and Washington, D.C., watched from home, the young team from the heart of America became world champions.

More evidence that you don’t have to be in a big coastal city to be a winner.

Kansas City is in the middle of a lot of things — it’s basically the geographic center of the United States, and, in fact, North America. It’s close to the population center, too. Often called the eastern-most western city, it’s where the Ford F-150 is built. Where Hallmark makes its headquarters. Where Garmin helps us all get where we are going. Where modern jazz was born. Where barbecue was perfected (for those with a sweet tooth). Both the Santa Fe and Oregon trails passed through Kansas City, making it the first stop in the American West.

It’s also in the top 5 affordable cities in the U.S., according to data we published recently at Credit.com.

Life in Kansas City

Pat Daneman, 61, found her way there 30 years ago because even back then, Kansas City was affordable.

“My husband had job offers in Chicago and Philadelphia as well and we picked K.C. because we wanted to buy a house and have good schools,” Daneman said. “Our first house was $90,000. I think we put down 10% and payments were about $600. His salary as a college professor was about $30K. It took me a few months to find a job. My salary was about $23K. That was 1986.”

Let’s pause on that math for a moment: their combined pre-tax income was nearly $4,500 a month; their mortgage payment only 15% of that. For a place in a suburb named Lenexa, on the Kansas side, about 10 miles southwest of downtown.

Ten years later the cKansas Cityouple sold that house for $125,000 and upgraded.

“We were able to pay off (that mortgage) in about 10 years so we could retire early,” she said.

Daneman’s solid financial footing is critical; her husband died two years ago.

“I am in a paid-off house,” she said. “My taxes are $4,200 and insurance is $1,800… My property taxes feel high, but I think they’re still lower than my parent’s taxes were on Long Island in the 1970s.”

She visits New York often — her daughter and cousins live in Brooklyn — and she loves the big city. But Kansas City is now home for her.

“I love Lenexa and my neighborhood. There are walking trails through the woods. I walk to the grocery, drugstore, library, pool — now that I don’t work in K.C. anymore, most places I go frequently are just a few miles away. I’m close enough to Lawrence to go there for concerts and other events at KU.”

Of course, it’s not perfect. Being in the middle of the continent, Kansas City is within Tornado Alley. Daneman makes an interesting point about living in inexpensive neighborhoods: Her home is probably worth $300,000 now, which is hardly the windfall many homeowners enjoy after a lifetime of mortgage payments. (“That is the down side of affordable housing — not a lot of growth,” she said) And then there’s the decided lack of beaches.

“The worst thing about not living on the coast is no coast,” she said.

The largest employer in Kansas City is the federal government; there’s a Federal Reserve Bank in both Kansas City and St. Louis, making Missouri the only state with two. The Internal Revenue Service has a large presence in the city, as does the Social Security Administration.

Kansas City is considerably larger and better off than its Missouri counterpart 250 miles away on I-70 — St. Louis’ population has been dwindling in recent years, while Kansas City has reversed urban population decline. Today, 25% of all jobs in Missouri and Kansas are in Kansas City, but even better — 63% of new jobs added in the past year within the two states are in Kansas City.

Not everything is rosy. A report by Brookings and the Mid-America Regional Council on Kansas City’s future prospects published in 2014 fretted that the area has a “relatively sparse number of large firms” that compete worldwide; and the city’s job market seemed more sluggish than others to recover from the recession. The report blamed a lack of cross-border cooperation for some of the problem — Kansas City, Mo., and Kansas City, Kan., haven’t always played nicely together, dating back to the Civil War. Racial tensions from when Missouri was a slave state and Kansas was free persist. Crime is still a serious problem, particularly in urban neighborhoods — while the city’s murder rate in 2014 was the lowest in decades, the rate rose dramatically last year, with one murder nearly every three days, according The Kansas City Star.

But Kansas City’s ample inventory of affordable homes is just one of the reasons people people seem enchanted by the City of Fountains.

“I always thought I would move back home to N.Y. at some point,” Daneman said. “But when you live someplace for a long time, that’s hard — much harder than I thought it would be to leave Kansas, of all places … There’s no comparison as far as space, peace, traffic, even weather.”

Kansas City By the Numbers

Affordable Cities Ranking: 5th

Housing Poor Residents: 29.8%

Zillow Home Value Index : $107,800

Median Household Income: $45,376

Remember, a good credit score can make a home more affordable in any area since it generally entitles you to better terms and conditions on a mortgage. (Landlords, too, are in the habit of reviewing a version of your credit report when accepting lease applications.) That’s why it’s always a good idea to check your credit before you start your search for a new home. You can see where you stand by pulling your credit reports for free each year at AnnualCreditReport.com and viewing your credit scores for free each month on Credit.com.

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