In These Cities, Buying a House Is Cheaper Than Renting

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Whether you’re renting your home or considering buying one, there hasn’t been any good news about availability or affordability in a long time. Purchase prices have jumped to an all-time high, and rents have risen in double digits on a monthly basis for the past seven months, up 17.1% in February 2022 from the previous year, according to a report from Realtor.com . In other words, housing is expensive.

There are a few places – mostly in small to mid-sized cities between the East Coast and the Midwest – where home ownership doesn’t seem completely out of reach. And there are some urban areas where rents have skyrocketed so quickly that it could end up being cheaper overall. Data released last month from a real estate website showed that the monthly cost of a starter home is more affordable than renting in 26 of the city’s 50 areas.

Where is it cheaper to buy than rent a house?

A few big caveats: Realtor.com’s calculations suggest that a potential homeowner makes a down payment of 7% (which isn’t that low) and has a mortgage rate of 3.45%. The monthly purchase price is a weighted average of prices for studio apartments, one and two bedroom apartments.

The majority of buy-out instead of lease subways are located in the eastern half of the United States:

  1. Birmingham, Alabama: $1,201 monthly rent vs. $668 when purchased
  2. Cleveland: $1,325 per month rent vs. $809 purchase.
  3. Pittsburgh: $1,530 per month rent vs. $945 purchase.
  4. St. Louis: $1,295 per month to rent vs. $812 to buy
  5. Detroit: $1,295 monthly rent vs. $901 purchase
  6. Baltimore: $1,773 per month rent vs. $1,242 purchase
  7. Virginia Beach, VA: $1,500 per month to rent vs. $1,091 to buy
  8. Orlando, FL: $1,820 per month to rent vs. $1,327 to buy
  9. Tampa, FL: $2,070 per month to rent vs. $1,543 to buy

Meanwhile, metropolitan areas where buying seems completely out of reach even in the face of skyrocketing rents are all places you might expect: Austin, New York, San Francisco, San Jose and Seattle round out the top five.

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