Skip to main content

Study Finds Homeownership Trumps Renting in Most Major Cities
Aug 17, 2011

Trulia has released its Summer 2011 Rent vs. Buy Index, which compares the cost of buying and renting a two-bedroom apartment, condominium or townhouse in America’s 50 largest cities based on population. The study found that, based on current market conditions, buying a home is cheaper than renting in 74 percent of major U.S. cities. Meanwhile, it is clearly better to rent in New York, Fort Worth, Omaha, Seattle, San Francisco and Kansas City. The top five U.S. cities cited by Trulia where buying a residence beats renting includes: Las Vegas; Detroit; Mesa, Ariz.; Fresno, Calif.; and Arlington, Texas. Renting remains cheaper than buying in the following cities, New York, N.Y.; Fort Worth, Texas; Omaha, Neb.; Seattle, Wash.; and San Francisco. "While recent stock market volatility on top of the slow economic recovery makes homebuyers nervous, it has not destroyed the American dream of homeownership. However, prospective homebuyers, who are ready and qualified to buy, face an uphill battle despite falling home prices and record-low mortgage rates,” said Ken Shuman, head of communications at Trulia. “Today, many banks are actually less enthusiastic about approving residential mortgage applications, which has dragged out the home buying process. Until a middle ground on lending practices can be met, many highly-qualified buyers may be forced to be renters by choice for now.” Buying a home in cities flooded with foreclosures continues to be considerably cheaper than renting, but this may be poised to change in the coming months. In Miami, for example, it is still less expensive to buy, but a mini-buying boom created by foreign investors and foreclosure freezes have caused its price-to-rent ratio to jump by 112 percent from 6 in January to 13 in July. Meanwhile, recent job gains in the auto industry have not countered Detroit’s falling home prices. For now, the city has experienced a setback since January with its price-to-rent ratio dipping 39 percent. Las Vegas, on the other hand, continues to be the best place to buy instead of rent for the past six months. “Many aspiring homeowners are on the fence about renting and buying in today’s market. Should they take advantage of falling home prices and low borrowing costs, or should they continue to rent until the economy stabilizes,” said Shuman. “Price alone should never be the sole factor in deciding to purchase a home. Instead, buyers should first ask themselves if they plan to live in the home for at least seven-to-10 years, could make monthly payments on the house, and have enough cash in the bank for a down payment and an additional six to eight months worth of mortgage payments. If you can answer ‘yes’ to each of these questions, then the cost of buying a home definitely outweighs renting in most cities.”
Aug 17, 2011
Top Texas Originator Sees No Surrender To 2023

Big cities will determine the battle

Industry News
Jan 26, 2023
There’s Good & Bad News On The Horizon

There will be a real estate slump, but the big cities are coming out much better

Industry News
Jan 26, 2023
Housing Prices Across Texas Likely Hobbled In 2023

But you’re getting a lot less for $1 million

Industry News
Jan 23, 2023
UWM Adds 'Control Your Price' To 'Game On' Pricing

New program provides 125 basis points in price enhancements for loan orignators.

Industry News
Jan 11, 2023
Rocket Pro TPO Relieves Brokers Of Credit Fee Burden

Will provided free credit reports to brokers if they get their loan closed with the Detroit lender.

Industry News
Jan 10, 2023
Former Employees Sue Rocket Mortgage Over OT Pay

Claim company failed to properly calculate & pay OT for working beyond 40 hours a week.

Jan 09, 2023