Although it costs more to own a home nowadays, according to the 2022 Rental Affordability Report released from ATTOM, renting is even more expensive in the majority of the country.
More specifically, the analytics of the data show that, out of 1,154 counties across the United States, ownership of a median-priced, three-bedroom home is more affordable in 58 percent of those counties. The study compared living expenses for both owning and renting and found that even though home prices are at a record-high, local wages are also rising and mortgage rates are low.
Unfortunately, for renters, the stats aren’t as promising. The latest Single-Family Rent Index from CoreLogic reports the fastest year-over-year rent growth in more than 16 years, a growth that reached its sixth consecutive record high.
The difference between the rising home prices and the rise of rental rates is that the landlord has the investment advantage. When you buy a home, your monthly mortgage serves as a return for you as a form of savings. Over time, as you pay down the home loan, you’re in the process of building equity and your net worth – all while home values rise. Plus, mortgage rates are typically fixed for anytime between 15 and 30 years, which sets up a reliable, consistent monthly payment.
So is renting or buying best for you? Here are some factors in the housing market nationwide to consider before you decide:
- Owning a home is more affordable for workers with average pay in most of the country because expenses take up a smaller portion of their pay.
- Home ownership is most affordable in rural areas, while renting is more common in metro areas. In 21 of the most 25 populous counties in the country, renting is more affordable. This also holds true in 35 of the 42 counties with at least 1 million residents (Los Angeles, Chicago, San Francisco, Miami and New York City), while counties including Houston and Tampa are more affordable for home ownership.
- Three-bedroom home prices increased more than three-bedroom apartments in 88 percent of counties in 2021.
To sit down and discuss your options to buy a home or rent, please call one of us at the Sands Realty Group at 843.839.4878.