Renting has become a more affordable option than buying a home in all of the 50 largest metropolitan areas in the United States, according to a new report.
Data from a newly released Realtor.com report showed that the monthly cost for a starter home in the largest 50 metropolitan areas in the country was 60.1% or about $1,027 more than the average monthly rent recorded in those same markets.
In the top 10 metropolitan areas that favor renting over buying, the average monthly payments for a starter home were $1,950 higher than rent prices. That is about 95.6% or nearly double the rent.
"In all of the major housing markets, renting is more affordable than buying a starter home," Realtor.com economist Jiayi Xu said. "It's important for first-time buyers who are thinking, 'Should I buy now or later?' This will give them a clearer picture [of] their financial costs."
10 Markets Where Renters Can Save the Most
The recent shift in the market toward renting becoming a more affordable option can be attributed to the fact that more apartment buildings are under construction and mortgage rates are staying elevated. That being said, renting can still become more expensive over time, especially because landlords can raise their prices.
In the short term, however, here are the metro areas where renters can save the most if they don't buy a home.
1. Austin, Texas
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Median rent: $1,530
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Median buying cost: $3,695
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Average monthly savings for renters: $2,165
2. Seattle, Washington
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Median rent: $2,000
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Median buying cost: $4,422
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Average monthly savings for renters: $2,422
3. Phoenix, Arizona
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Median rent: $1,543
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Median buying cost: $3,071
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Average monthly savings for renters: $1,528
4. San Francisco, California
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Median rent: $2,815
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Median buying cost: $5,504
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Average monthly savings for renters: $2,689
5. Los Angeles, California
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Median rent: $2,830
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Median buying cost: $5,369
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Average monthly savings for renters: $2,539
6. San Jose, California
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Median rent: $3,206
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Median buying cost: $5,986
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Average monthly savings for renters: $2,780
7. Nashville, Tennessee
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Median rent: $1,589
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Median buying cost: $2,955
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Average monthly savings for renters: $1,366
8. Portland, Oregon
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Median rent: $1,655
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Median buying cost: $3,051
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Average monthly savings for renters: $1,396
9. Sacramento, California
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Median rent: $1,845
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Median buying cost: $3,359
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Average monthly savings for renters: $1,514
10. Houston, Texas
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Median rent: $1,379
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Median buying cost: $2,482
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Average monthly savings for renters: $1,103
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