Own or rent? While there may be pros and cons for both living situations, it seems that buying a home in 2016 is more affordable than renting a home. According to a recent Trulia analysis, it is now 37.7% cheaper to buy than rent in the top 100 cities in America. This recent article by Catey Hill of Market Watch, shares the details of this recent analyis and the ten cities that are 50% cheaper to buy than to rent.
Trulia’s analysis compared the monthly costs of owning — including mortgage payments, maintenance, insurance and taxes — to those for renting comparable properties. It factored in such things as closing costs, down payments, security deposits, rent appreciation, renter’s insurance and more. It assumed that new buyers would stay in their homes for at least seven years, put 20% down and got a 3.7% mortgage interest rate.
Of course, the cost of renting vs. buying is far from the only measure one should use when determining whether to buy a home. As a recent story on MarketWatch noted, factors like whether you might need to move in a few years can mean renting makes more sense even if it’s more expensive a month in the short-term; this piece by Barron’s details many other considerations.
The Trulia data found that buying is cheaper than renting in all of the 100 largest metro areas. The range is from over 50% cheaper in Miami and Fort Lauderdale, Fla., to under 20% in Honolulu and San Francisco. The biggest advantage to buying tends to be in the South.
10 cities where it’s 50% cheaper to buy than to rent
2. West Palm Beach
4. Fort Lauderdale
5. Charleston, S.C.
6. Baton Rouge
7. New Orleans
10. Columbia, S.C.
[Read the full article here]