For $450 a month, Diane Yap lives in a bedroom in a large Manoa home with eight roommates.

There's a kitchen but no living room. About a half-dozen refrigerators — shared by the roommates — are scattered throughout the house, which is undergoing renovations.

Part of her room has a 4-foot ceiling, under which is her twin bed and a TV that carries only two channels. She calls it "the cave."

But it's not the rent or the less-than-modest accommodations that has her looking for a new rental.

It's the house rules.

No guests after 10 p.m., no loud noise, no slamming doors.

"You make sacrifices to live the way you want to, but (it should be) within reason," said Yap, a 22-year-old doctoral student at the University of Hawai'i-Manoa, who moved here from San Francisco in August 2006. "I mean, I wouldn't have parties at 3 a.m. But it would be nice to have friends over to watch movies every once in a while."

So she's back on the hunt for an affordable rental in one of the most expensive real estate markets in the country.

About 40 percent of Hawai'i's population are renters who face some of the steepest rental rates in the country. Last year, it topped the list of most expensive states for renters, according to a report issued by the National Low Income Housing Coalition.

To afford a two-bedroom apartment in Hawai'i, renters had to earn $48,940 a year, more than those anywhere else in the nation, according to the report. Nationally, renters had to earn $33,924 to afford a two-bedroom apartment at fair-market rent.

California, Massachusetts, New Jersey and New York rounded out the top five most expensive states for renters in 2006. New York replaced Maryland, which was in the top five in 2005.

That may be dismaying news for college students or young professionals who can't afford to be picky about rentals.

Yap, who works part-time as a teaching assistant at UH, can afford up to $500 per month in rent. She needs to find a unit on a bus line or within walking distance to the campus, as she doesn't own a car. But she's optimistic she'll find something by March 31, when her lease in Manoa is up.

"I think if you look really hard, you'll be able to find a good deal," said Yap, who's searching for rentals online. "(The market) is really inflated, but that's to be expected. There's so much demand for places here."

NATIONWIDE PROBLEM

That demand for affordable rentals isn't unique to Hawai'i.

Of the 109.9 million occupied housing units across the country last year, nearly one-third — or 34.2 million units — were occupied by renters, according to the U.S Census Bureau.

As housing demand cools in some markets nationwide, many struggle to sell their homes and condos. In places where prices got overheated, there are fewer buyers able or willing to purchase. But instead of lowering the asking price, many homeowners are opting to rent their properties to cover the expenses.

"There's a lot of uncertainty in the homeownership market right now," said Danilo Pelletiere, research director at the National Low Income Housing Coalition in Washington, D.C. "That's creating a glut of housing. ... In strictly economic theories, the more supply, rent should go down and we should get to a reasonable level of home values and rent. But for a lot of reasons, that doesn't work in reality."

Casey Kozuma, 29, knows how rent can vary from city to city.

He's lived in rentals from Michigan to Texas to California. While a student at Pacific University in Oregon, he found a two-bedroom apartment a mile from campus for about $550 total. He split that with a roommate.

Now living in Makiki, Kozuma spends close to $700 a month for an apartment he shares with a roommate.

"The market here is so expensive," said Kozuma, a physical therapist. "I never thought I would rent. I always thought renting was just throwing money away."

Kozuma lived with his parents in Kane'ohe when he moved back home seven months ago to save money to buy his own place. That didn't happen.

"The challenge for me is seeing this money go to waste," he said. "But I had to get out. I'm 29. It's time to get out."

When Maria Benavides moved from Hilo to Honolulu in May 2005, she was shocked at the high rent. She and her then-boyfriend settled on a one-bedroom apartment in Waikiki for $1,450 a month, including utilities. It was $450 more than they could afford.

Now, the 25-year-old graduate student at UH lives there alone. Part of her student loan now goes toward rent.

"I'm so getting ripped off," said Benavides, who also works full time for a research company. "My lease is up in June, and I gotta get something cheaper."

She loves the location of her apartment but she can't afford the monthly rent. Already, she's had to cancel her Internet service to save money.

She's been searching online for another rental. Something in Waikiki, pet-friendly, with a parking stall and under $1,200.

"I see people who can't afford their rent and it's really sad," said Benavides, who's getting her master's degree in social work. "And then I look at myself and say, 'God, I could be right there with them.' That's really scary."

LUCK OF THE RENTER

Sometimes finding a place takes more than just perseverance. It takes luck.

Keoki Anderson, 27, moved back to O'ahu five years ago after serving in the Navy.

He saw an ad in the newspaper for a one-bedroom apartment in McCully. The rent was listed at $700 a month and included water, sewage and a parking stall.

He made an appointment to see the unit — the first on his list — and moved in two weeks later.

"I got really lucky," said Anderson, a student at Kapi'olani Community College and a luxury-car salesman. "Everything else was $850 and up. So the price was what caught my attention."

He loves the location, which is near freeway on-ramps and restaurants. It takes him only a few minutes to get to work, and he's a short bike ride to the beach.

His rent only went up once in five years — by $50 — but Anderson's not looking to stay here permanently. He's saving up money to buy his own place someday, he hopes in Hawai'i.

Still, he's learned a lot from his experience of renting in such an inflated market.

"I've learned that you've got to look at the whole picture," he said. "If it fits into your budget and if it's convenient for you, and you feel comfortable and safe, go for it. Don't just settle for something that's just all right."