Tables Turn in 2011 on Rent vs. Own
Rents have surged as home prices have dropped, which have prompted some to ponder whether homeownership is really worth it. Moody's Analytics data has suggested that it makes more financial sense to rent than buy in many U.S. cities, but Moody's chief economist Mark Zandi now says that is about to change.
"By mid 2011 and certainly by end of 2011, buying will be superior to renting in most parts of the country," Zandi says.
Home prices are expected to fall further, making more homes affordable, whereas rent prices are expected to continue to rise this year.
The following are a few of the top cities where it makes more sense to buy than rent, according to Moody data. (Experts often recommend buying when the price-rent ratio is below 15 and rent when it's above 20.)
▪ Cleveland: 11.43
▪ Pittsburgh, Pa.: 11.71
▪ Detroit: 12.32
▪ Phoenix: 12.35
▪ Atlanta: 12.82
▪ Tampa, Fla.: 13.08
▪ Orlando, Fla.: 13.1
▪ Cincinnati: 13.74
▪ Las Vegas: 13.89
Source: "Rent vs. Own Ratio to Flip in 2011?" Fortune (Jan. 4, 2011)
Real Living Real Estate Professionals - Redding, CA
Home Sales Realtor - Short Sale Team Member - Redd
774.289.5521 - Worcester, MA
Remax Professional Associates
People should remember the long-term gain to owning. Rents will always go up while their mortage will remain the same. Friends of mine purchased in 1985. Today they are paying $325 per month for their mortgage - the same as they were paying in 1985.
Jan 14, 2011 04:10 AM
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Berkshire Hathaway / Prudential Ca Realty - El Cajon, CA
619-504-8999,#1 Resource SD Relo
true these prices are on avg homes however and if ur talking to a renter then i believe the price in san diego needs to be on starter homes to make it work
Mar 15, 2011 04:20 AM
Rainmaker
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34,772
Julie Press-Raese
LLC, Realtor, ARB, CRS, GRI
Real Estate Resources
I'm here to stay! This is my home and I wouldn't live anywhere else but here!
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