Buying a home is cheaper than renting in all of the 100 largest metro areas across the US, but buying ranges from 19% to 70% cheaper than renting. The financial benefit of buying instead of renting is narrowest in San Francisco, Honolulu, San Jose, and New York. Over the past year, the gap between renting and buying has narrowed most in the Bay Area. One year ago, buying was 35% cheaper than renting in San Francisco and 38% cheaper than renting in San Jose; now, the difference is 19% and 24%, respectively. These metros have seen strong price increases year-over-year. In contrast, the gap didn’t narrow at all in New York, where buying remains 26% cheaper than renting, both now and a year ago. On Long Island, the difference actually widened from 34% one year ago to 36% today. New York, Long Island, and other Northeastern metros have seen more modest price rebounds over the past year, despite rising rents. So where is BUYING a home vs. renting a tougher call? In San Francisco the cost of buying vs. renting is -19%; In NYC it’s -26%; In Los Angeles it -35%; and on Long Island, NY it’s -36% (36% less.) I’ve been saying this to my clients for years. If your credit is solid and you plan on being in a home for more than 3 years, you may want to consider buying instead of renting. In some cities, it’s a close call with only a small percentage difference, but in areas of the mid-west and the south, your mortgage payment may be significantly lower than comparable rents. Do your homework, talk to a good mortgage specialist or start with your realtor, with mortgage interest rates remaining at all-time lows, buying may be a viable option for many currently renting.
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Glenmoore Real Estate