Difficult to Believe Which Is Cheaper: Housing Markets: Renting Vs. Owning

June 26, 2012 / Russell Legato, Residential Property Analyst

Situations in the housing markets: renting vs. owning is more expensive in some parts of the country, but, cheaper in others. Seattle is one such place. In fact, the monthly rent is an average of $377 lower than it would cost to live in the same house and make mortgage payments.

Difficult to Believe Which Is Cheaper: Housing Markets: Renting Vs. Owning

Low interest rates are not always going to make buying more attractive, despite the lowered monthly mortgage payment. Overall, single-family home sales dropped 1.5 percent in May as compared to April. Surprisingly, this occurred during the busy spring season.

In the year 2004, homes were owned by 69 percent of all citizens. Currently, that percentage is at 65 percent. The number is dropping in spite of the real estate market reportedly recovering. Many owners, who cannot get a realistic price from a buyer, are opting to rent the house. Single-family home rentals are at all all-time high. They now account for one-third of all rentals in the U.S.

Nationally, it is cheaper to buy a home than to rent one. Of course, there is the down payment, insurance and property tax that adds to the cost of the monthly mortgage payment. Still, there are thirteen cities in which it is cheaper to rent.

As the law of averages would indicate, the cost of renting is rising. As they increase, it will delete the savings. The owning vs. renting should level out over time. For now, renting homes that the owners cannot sell is a way to pay taxes and other expenses. When rents go up 4 percent this year as expected, it may propel more people to consider homeownership again.

The five markets where renting is said to be more affordable than owning are Northern New Jersey, Long Island, New York, parts of California, Seattle and Honolulu, Hawaii.

A four-bedroom, three bathroom home is listed at $699,000 in Englewood Cliffs, which is approximately fifteen minutes away from Manhattan. It is offered for rent at $3,000 per month. Owning it would cost a monthly mortgage, tax and insurance payment of $3,410 per month.

Rents are about a thousand dollars less per month than it would cost to become a homeowner in San Jose, California. In Orange County, renting saves over $800 over owning a home. This is if the buyer makes a 10 percent down payment and takes out a 30-year mortgage at a low rate of interest. There are now rentals available in areas where it was unheard of in 2005.

Situations in the housing markets: renting vs. owning is more expensive in some parts of the country, but, cheaper in others. Seattle is one such place. In fact, the monthly rent is an average of $377 lower than it would cost to live in the same house and make mortgage payments.

Low interest rates are not always going to make buying more attractive, despite the lowered monthly mortgage payment. Overall, single-family home sales dropped 1.5 percent in May as compared to April. Surprisingly, this occurred during the busy spring season.

In the year 2004, homes were owned by 69 percent of all citizens. Currently, that percentage is at 65 percent. The number is dropping in spite of the real estate market reportedly recovering. Many owners, who cannot get a realistic price from a buyer, are opting to rent the house. Single-family home rentals are at all all-time high. They now account for one-third of all rentals in the U.S.

Nationally, it is cheaper to buy a home than to rent one. Of course, there is the down payment, insurance and property tax that adds to the cost of the monthly mortgage payment. Still, there are thirteen cities in which it is cheaper to rent.

As the law of averages would indicate, the cost of renting is rising. As they increase, it will delete the savings. The owning vs. renting should level out over time. For now, renting homes that the owners cannot sell is a way to pay taxes and other expenses. When rents go up 4 percent this year as expected, it may propel more people to consider homeownership again.

The five markets where renting is said to be more affordable than owning are Northern New Jersey, Long Island, New York, parts of California, Seattle and Honolulu, Hawaii.

 

A four-bedroom, three bathroom home is listed at $699,000 in Englewood Cliffs, which is approximately fifteen minutes away from Manhattan. It is offered for rent at $3,000 per month. Owning it would cost a monthly mortgage, tax and insurance payment of $3,410 per month.

Rents are about a thousand dollars less per month than it would cost to become a homeowner in San Jose, California. In Orange County, renting saves over $800 over owning a home. This is if the buyer makes a 10 percent down payment and takes out a 30-year mortgage at a low rate of interest. There are now rentals available in areas where it was unheard of in 2005.

In Honolulu, Hawaii the difference is even larger. A rental goes for $1,100 while ownership would cost $400 to $700 more each month. At this time, renting is cheaper in thirteen cities.

In Honolulu, Hawaii the difference is even larger. A rental goes for $1,100 while ownership would cost $400 to $700 more each month. At this time, renting is cheaper in thirteen cities.

Articles other readers have found interesting...

Top News Stories:

Comments are closed.