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How Much Less is Buying a Home Than Renting?

By
Real Estate Broker/Owner with New York Real Estate Experts

Buying a Home is 36% Less Expensive Than Renting Nationwide! | Keeping Current Matters

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 in the 100 largest metro areas in the United States. The updated numbers actually show that the range is an average of 5% less expensive in Orange County (CA) all the way up to 46% in Houston (TX), and 36% Nationwide!

Other interesting findings in the report include:

  • Interest rates have remained low and even though home prices have appreciated around the country, they haven't greatly outpaced rental appreciation.
  • Some markets may 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. If you are one of the many renters out there who would like to evaluate your ability to buy this year, meet with a local real estate professional who can help you find your dream home.

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Rummy Dhanoa - Broker with New York Real Estate Experts  

Rummy Dhanoa - Broker with New York Real Estate Experts

Comments (1)

Mike Wong
Keller Williams Realty Southwest - Sugar Land, TX
Realtor: Commercial, Residential, Leasing, Invest

Grat post topic. In Houston it makes sense to purchase with rising rent prices, along with investors and developers to continue acquiring properties due to a shortage and rising demand. I'm sure New York is the same. 

Apr 19, 2016 07:16 AM