Homeownership Beats Renting in 74 Percent of Major U.S. Cities
Trulia Releases Summer Rent vs. Buy Index, Revealing Housing Market Rebound in Miami and Continued Setbacks in Detroit, Fresno and Sacramento
(firmenpresse) - SAN FRANCISCO, CA -- (Marketwire) -- 08/16/11 -- today released its Summer 2011 Rent vs. Buy Index, which compares the cost of buying and renting a two-bedroom apartment, condominium or townhouse in America's 50 largest cities based on population.
Based on current market conditions, is cheaper than renting in 74 percent of major U.S. cities. Meanwhile, it is clearly better to rent in New York, Fort Worth, Omaha, Seattle, San Francisco and Kansas City. In between both sides of the rent versus buy spectrum, there is a grey area. Depending on personal circumstances, such as one's tax bracket, it may make more sense to buy a home in Oakland, Austin, San Jose, Memphis, Boston, Los Angeles and Portland, even though it is still relatively cheaper to rent.
NOTE: The price-to-rent ratio is the median listing price divided by the annualized median rent. Ratios that are 15 and under indicate buying is less expensive than renting, while ratios that are 20 or higher indicate renting is less expensive than buying.
Buying a home in cities flooded with continues to be considerably cheaper than renting, but this may be poised to change in the coming months. In Miami, for example, it is still less expensive to buy, but a mini-buying boom created by foreign investors and foreclosure freezes have caused its price-to-rent ratio to jump by 112 percent from 6 in January to 13 in July. Meanwhile, recent job gains in the auto industry have not countered Detroit's falling home prices. For now, the city has experienced a setback since January with its price-to-rent ratio dipping 39 percent. Las Vegas, on the other hand, continues to be the best place to buy instead of rent for the past six months.
"While recent stock market volatility on top of the slow economic recovery makes homebuyers nervous, it has not destroyed the American dream of homeownership. However, prospective homebuyers, who are ready and qualified to buy, face an uphill battle despite falling and record-low ," said Ken Shuman, Head of Communications at Trulia. "Today, many banks are actually less enthusiastic about approving residential mortgage applications, which has dragged out the home buying process. Until a middle ground on lending practices can be met, many highly-qualified buyers may be forced to be renters by choice for now."
"Many aspiring homeowners are on the fence about and buying in today's market. Should they take advantage of falling home prices and low borrowing costs, or should they continue to rent until the economy stabilizes?" said Ken Shuman, Head of Communications at Trulia. "Price alone should never be the sole factor in deciding to purchase a home. Instead, buyers should first ask themselves if they plan to live in the home for at least seven-to-10 years, could make monthly payments on the house, and have enough cash in the bank for a down payment and an additional six to eight months worth of mortgage payments. If you can answer 'yes' to each of these questions, then the cost of definitely outweighs renting in most cities."
To view a new interactive data visual illustrating how the cost of renting versus buying has changed over the last six months, click .
To view a slideshow of the findings, click .
To view a full list of Rent vs. Buy Index rankings for the 50 largest U.S. cities, click .
To check out Trulia's current and archived industry reports and consumer surveys, click .
Trulia calculated the price-to-rent ratios for the 50 largest U.S. cities using the median list price compared with the median rent on two-bedroom apartments, condominiums and townhomes listed on Trulia.com as of July 1, 2011. To view the complete methodology including sample price-to-rent ratio calculation, interpretation key for the ratio and definitions, click .
is the fastest growing online real estate resource, empowering buyers, sellers and renters with smarter tools to help them find the right home. Trulia gives you the inside scoop to help you find the best place to live. Our smart and personalized real estate search experience brings together vital local information, community insights, market data and national listings all in one place. Trulia is headquartered in downtown San Francisco and is backed by and .
Daisy Kong
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Datum: 16.08.2011 - 10:00 Uhr
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