Buying a Home is 35% Less Expensive than Renting!

By
Real Estate Agent

In the latest Rent vs. Buy Report from Trulia, they explained that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage throughout the 100 largest metro areas in the United States.

The updated numbers actually show that the range is from an average of 16% in Honolulu (HI), all the way to 55% in Sarasota (FL), and 35% Nationwide!

The other interesting findings in the report include:

  • Interest rates have remained low and even though home prices have appreciated around the country (3.9%), they haven’t greatly outpaced rental appreciation (3.7%). “In the past year, these two trends have made homeownership even more affordable compared with renting.”
  • Some markets might tip in favor of renting if home prices increase at a greater rate than rents and if – as most economists expect – mortgage rates rise, due to the strengthening economy.
  • Nationally, rates would have to rise to 10.6% for renting to be cheaper than buying – and rates haven’t been that high since 1989. 

Bottom Line

Buying a home makes sense socially and financially. Rents are predicted to increase substantially in the next year, so lock in your housing cost with a mortgage payment now.

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Home Buying
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Rainmaker
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Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

Need to list assumptions like down payment. HI is a very expensive place to rent. It is quite true with 20% down one's mortgage is less than renting an apartment in west coast.

 

May 20, 2015 11:42 AM #1
Rainer
46,424
Kull Realty Group
Wellington, FL
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I bet..thanks for the input!

May 20, 2015 11:44 AM #2
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Rainer
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Kull Realty Group

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