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Mortgage Rates in Minnesota

Kimberly Rotter
By: Kimberly Rotter

Our Mortgages Expert

Nathan Alderman
Check IconFact Checked Nathan Alderman

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There are many mortgage lenders serving Minnesota, including banks, credit unions, and online lenders. Buyers purchasing a new home should shop around and get several quotes to find the best mortgage rates. Even a small difference in rate can make a big impact on total home-buying costs, so make sure you follow today's mortgage rates in Minnesota.

To help in your search, check out this guide to some of the most affordable places in the state to buy a home.

5 affordable places to live in Minnesota

If you're looking for a low-cost place to purchase your Minnesota home, here are five cities and towns recognized for their affordability.

1. Rochester

Rochester is the Minnesota city with the lowest cost of living. It ranks 53rd on Niche's list of the most affordable cities in the U.S., and it's also been ranked as the No. 4 best U.S. city in which to buy a house. Around 68% of residents own in this attractive urban area, and homes here have a median value of $200,100 -- a bit below the national median of $217,500. However, Olmsted County does have some of the highest property taxes in the U.S., averaging 1.09% of a property's assessed fair market value, according to

2. St. Paul

Niche ranks St. Paul as No. 91 in all of America in terms of cost of living. It's also one of the most diverse cities and has been recognized as a great place for young professionals. St. Paul offers attractions such as the Como Park Zoo and Conservatory and the Science Museum of Minnesota. The low cost of homeownership is also part of why the city is so attractive, with a median price of $208,000. Property taxes in St. Paul also come in a bit below those in Rochester, with an average rate of 1.05% of the assessed fair market value of homes.

3. Minneapolis

Minneapolis is the eighth-best city for young professionals, but its residents, unlike those of other cities in our list, tend to rent their homes -- just 47% are homeowners. The high median home value of $251,600 is one reason there are fewer owners than renters, along with the relatively high property tax rate of 1.14% of assessed fair market value in Hennepin County.

4. Hibbing

Though it's not quite a city, Hibbing is a large town, with a population of 16,014. It comes in at No. 6 out of 478 for places with the lowest cost of living in Minnesota. Hibbing's median home value is much lower than the other places on this list, coming in at $109,800 -- which helps explain why 72% of residents own their own homes. Property taxes in St. Louis County are also lower at 0.78%, which makes becoming a homeowner here much cheaper.

5. New Ulm

The town of New Ulm has a population of just over 13,000, and it's been recognized as an affordable place to live, as well as one of the top places in the U.S. to retire. The median home value here is $141,300, and 76% of residents own their homes. Taxes are a bit higher here than in the other town on this list -- Brown County has an average property tax rate of 1.03% of a property's assessed fair market value. Residents may be willing to pay the higher taxes to enjoy the attractions that New Ulm offers, including Flandrau State Park and the Herman Monument Society, where you can take in the views and enjoy exciting historical exhibits.

While many factors go into deciding where to buy a home, cost of living is definitely worth considering. Buying in a less expensive area means your money stretches further. This could translate to borrowing less, qualifying for a mortgage loan at a better rate, lower monthly payments, and paying less over time to purchase your home.

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The Ascent's best mortgage lenders

If you want to uncover more about the best mortgage lenders for low rates and fees, our experts have created a shortlist of the top mortgage companies. Some of our experts have even used these lenders themselves to cut their costs.

Our Mortgages Experts