Cheapest Places To Live In Minnesota For 2020

The 10 Cheapest Places To Live In Minnesota For 2020

1. Hibbing

If you're trying to live the high life without breaking the bank, there's probably nowhere better in Minnesota than Hibbing, the most affordable city overall statewide. Renters can rejoice at Hibbing's super low median rent of $548/month, the lowest price you'll see on this list. But what really moves Hibbing to the top spot is the affordability of its houses. With residents earning a median income of $46,826 and paying a median home price of $103,000, Hibbing is firmly in the top ten in Minnesota for home price to income ratio.

To learn a little more about the root of the riches that helped make Hibbing the affordable city it is today, definitely check out the Hull Rust Mine, one of the largest open-pit mines in the world. Admission is free, in keeping with the cheap theme.

The median household income in Hibbing comes in at $46,826 and the median home value is $103,000 for 2020. The unemployment rate sits at 6.3%.

You'd have a tough time believing you're living in one of the most expensive states in America when you're in Montevideo. Homes in Montevideo are the second cheapest in Minnesota, with a median price tag of $82,600. With residents earning a median income of $45,804, they pay the smallest proportion of their income toward homes of anywhere in the state. Rent is also quite cheap in Montevideo, but it's still more economical to buy.

Montevideo is located in the western part of the state, where the Minnesota and Chippewa Rivers converge.

The median household income in Montevideo comes in at $45,804 and the median home value is $82,600 for 2020. The unemployment rate sits at 3.0%.

3. New Ulm

Located about 90 miles southwest of Minneapolis, New Ulm comes in as the third least expensive city in Minnesota. New Ulm is heavily influenced by its German heritage, as evidenced by the "Hermann the German" tower/monument downtown and Schell's Brewery/Mansion. New Ulm doesn't stint on important amenities to earn it's uber-affordability status; in fact, we named it the third best place to raise a family in Minnesota for 2020.

The median income in New Ulm is $56,288 and the median home price is $133,900, putting New Ulm in a comfortable position in terms of home price to income ratio. The city is about equally affordable for renters as it is for buyers.

The median household income in New Ulm comes in at $56,288 and the median home value is $133,900 for 2020. The unemployment rate sits at 2.2%.

4. Kasson

With a median home price substantially higher than the preceding cities on this list, you may wonder why Kasson ranks as the fourth cheapest city in Minnesota. While home prices in Kasson are a bit steep at $171,600, residents are paid correspondingly higher salaries, with a city-wide median income of $71,827. Where Kasson really shines, though, is the affordability of rent. For such a well-off populace, a median rent of $642/month is absurdly low. In fact, it's less than half of the average rent in Minnesota. Not to mention Kasson got an almost-perfect 9.5/10 on our overall Snackability score, so you know it's a great place to call home.

Kasson is located about 20 minutes west of Rochester.

The median household income in Kasson comes in at $71,827 and the median home value is $171,600 for 2020. The unemployment rate sits at 1.4%.

5. Crookston

You don't need to be a crook to have all the money you need in Crookston, the fifth most inexpensive city in Minnesota. The median home price in Crookston is $125,800 and the median income is $53,212, so paying off the mortgage in Crookston happens in no time flat. With a median rent of $695, Crookston isn't as affordable for renters, when looked at as a proportion of income.

Crookston is in the northwestern part of the state, a half hour southeast of Grand Forks, North Dakota.

The median household income in Crookston comes in at $53,212 and the median home value is $125,800 for 2020. The unemployment rate sits at 3.8%.

Located in the south-central part of the state, Redwood Falls ranks as the sixth most affordable city in Minnesota. Redwood Falls has the fourth cheapest homes in the state, with a median price tag of $96,600. Coupled with a median income of $50,247, Redwood Falls has the second lowest home price to income ratio in Minnesota. If you stick to free activities like hiking at Alexander Ramsey Park, you'll have even more money left in your wallet at the end of every week.

The median household income in Redwood Falls comes in at $50,247 and the median home value is $96,600 for 2020. The unemployment rate sits at 2.5%.

7. Isanti

Isanti is the seventh cheapest city in Minnesota overall, despite having some of the highest home prices on this list at $165,000. Isanti residents are paid well enough to afford these homes though, with the city's median income sitting at a healthy $72,867. The median rent in Isanti is the highest on this list at $931, but that's still well below the statewide average.

Isanti is located about 40 miles north of Minneapolis.

The median household income in Isanti comes in at $72,867 and the median home value is $165,000 for 2020. The unemployment rate sits at 2.7%.

8. International Falls

Located on the border of Canada, International Falls goes by the nickname "Icebox of the Nation." But if you can withstand the bitter cold, International Falls has some sweet deals for you. The first least expensive homes in Minnesota are in International Falls, where the median home price is $82,200. With residents earning a median income of $41,108, International Falls has one of the best home price to income ratios in the state.

As a budgeting bonus, admission to Smokey Bear Park is totally free. Just don't get spooked by the 26-foot bear when you drive in.

The median household income in International Falls comes in at $41,108 and the median home value is $82,200 for 2020. The unemployment rate sits at 9.0%.

9. Fairmont

Fairmont makes the cut as the ninth most affordable place in Minnesota by virtue of having the tenth cheapest homes in the state. The median home price in Fairmont is $121,600 and the median income is $48,826, so it's a piece of cake paying the mortgage off. Complete with seven parks and countless nature trails, you'll never go wanting for free entertainment in Fairmont either.

Fairmont is located in the south-central part of Minnesota, near the Iowa border.

The median household income in Fairmont comes in at $48,826 and the median home value is $121,600 for 2020. The unemployment rate sits at 4.0%.

10. Owatonna

Located an hour south of Minneapolis, Owatonna places tenth on our list of cheapest places to live in Minnesota. Owatonna scored an 8.5/10 on our overall Snackability score, so you're not sacrificing quality for affordability living here. And between hiking trails at Mineral Springs Park and the canoeing at Rice Lake State Park, you'll never be left wondering what to do on a budget each weekend.

The median home price in Owatonna is $154,000 and the median income is $60,976.

The median household income in Owatonna comes in at $60,976 and the median home value is $154,000 for 2020. The unemployment rate sits at 4.4%.

How We Determined The Most Affordable Places To Live In The North Star State For 2020

The two most important things to think about when it comes to being able to afford if you can live comes down to:

1. How much do money do I make?
2. How much do I have spend to live there?

You need to understand your costs in the context of how much money you make.

For example, if the median household earns $100,000 and spends $40,000 on housing it's actually cheaper to live there than a place with a median income of $50,000 and housing costs of $21,000. You might spend more on housing, but you have more money overall to play with.

With that example in mind, we derived several statistics from the latest Census American Community Survey 2014-2018 around incomes and costs. They are:

• Median Home Price / Median Income (lower is better)
• Median Income / Median Rent (Higher is better)
• Median Home Price

We added simply median home price because high home prices generally correlate with higher expenses for all costs related to homes (heating, electricity, etc).

You can then compare these metrics in each of the places in Minnesota to figure out which is the least expensive.

What you are left with is a "Cost of Living Index" by taking the average rank of each of these metrics for each city.

So we used that cost of living index in order to rank all of the 146 places in Minnesota that have more than 5,000 people.

The place with the lowest cost of living in Minnesota according to the data is Hibbing. You can download the data here.