Rent vs buy in Minnesota
With today's numbers over 7 years, renting wins in 19 of the 19 cities of 50,000+.
Minnesota's cities: rent or buy
| City | Verdict | 7-year result | Break-even (up to 30 yrs) | Typical home | Rent /mo |
|---|---|---|---|---|---|
| Duluth | Rent | renting wins by $28k | year 15 | $296,120 | $1,434 |
| Woodbury | Rent | renting wins by $37k | year 13 | $460,987 | $2,196 |
Data comes from Zillow Home Value and Observed Rent indexes. The verdicts use our rent vs buy method, which compares renting against buying with 20% down over a 7-year period.
Minnesota's bottom line
Over 7 years, renting is the better deal in all 19 of Minnesota's cities of 50,000+ people. The closest race comes in Blaine: a $381,873 home goes against $2,064 monthly rent, and renting wins by $6k. There, you won't break even until year 8. Rent in Minneapolis runs $1,747 a month, while the typical home costs $328,351. Renting comes out ahead by $17k, and break-even doesn't arrive until year 11.
Even cheaper homes won't flip the math in your favor. A home in St. Cloud costs $256,326, and rent for it is just $1,241 a month. Renting comes out ahead by $22k there, and break-even doesn't come until year 14. Costlier suburbs make that gap wider. Rent on a $505,176 home in Plymouth comes to $1,907. Renting comes out ahead by $88k, and break-even never happens within 30 years.
Across the state, the numbers show why owner costs add up fast each year. Here just 28% of households rent, below the 35% US share. Even so, the median monthly rent of $1,280 beats the US figure of $1,413. If you buy a typical $349k home, you pay 1.02% in property tax and $1,568 a year for homeowners insurance. Each one exceeds the US figures, 0.94% and $1,308 a year. Over the last 10 years, home prices grew 5.9% a year, yet catching up still takes time.
Our take: rent in Minnesota unless you're still living there past year 8. Our view: your monthly bills run lower as a renter, while owners shoulder steeper tax and insurance.