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
Median rent: $1,530
Median buying cost: $3,695
Average monthly savings for renters: $2,165
2. Seattle, Washington
Median rent: $2,000
Median buying cost: $4,422
Average monthly savings for renters: $2,422
3. Phoenix, Arizona
Median rent: $1,543
Median buying cost: $3,071
Average monthly savings for renters: $1,528
4. San Francisco, California
Median rent: $2,815
Median buying cost: $5,504
Average monthly savings for renters: $2,689
5. Los Angeles, California
Median rent: $2,830
Median buying cost: $5,369
Average monthly savings for renters: $2,539
6. San Jose, California
Median rent: $3,206
Median buying cost: $5,986
Average monthly savings for renters: $2,780
7. Nashville, Tennessee
Median rent: $1,589
Median buying cost: $2,955
Average monthly savings for renters: $1,366
8. Portland, Oregon
Median rent: $1,655
Median buying cost: $3,051
Average monthly savings for renters: $1,396
9. Sacramento, California
Median rent: $1,845
Median buying cost: $3,359
Average monthly savings for renters: $1,514
10. Houston, Texas
Median rent: $1,379
Median buying cost: $2,482
Average monthly savings for renters: $1,103
