Despite rising home prices and mortgage rates, it’s still cheaper to buy a home than to rent one in America’s largest cities. A new report from San Francisco, Calif.-based real estate site Trulia finds that, nationally, it’s 35% less expensive to own a home. Even in notoriously pricey, renter-heavy cities like San Francisco and New York, it remains 9% and 21% cheaper, respectively.
Of the top 10, eight are located in Calif., a state in which many cities, despite being plagued by high unemployment and the foreclosure crisis, never saw prices fall enough to fully align with other local economic fundamentals like median income.
The metro area that will swing back toward renting first is San Jose, Calif., when mortgage rates climb to 5.2%. It’s currently 4% cheaper to buy than rent in the Silicon Valley hub, a dramatic change from last year when it was 31% cheaper.
This really proves what we’ve all known: buying is cheaper than renting. It’s always a good time to buy.
I’m not sure what you’re doing this Monday morning, but if you’re not buying a home, you’re probably starting off this week in the wrong way.
What does your calculations show? Is buying cheaper than renting?