Buying a home remains valuable
Despite a shift in the American Dream which is putting less emphasis on homeownership, Trulia’s third quarter Rent vs. Buy Index reveals that of the 50 largest cities in America, 74% now boast that owning a home is more affordable than renting which is welcome news to real estate practitioners.
New York, Seattle and San Francisco are the only three cities where it is more affordable to rent than own and in only 14% of cities is it similarly even in affordability of owning or renting.
Miami and Las Vegas are stand out cities with Miami’s performance improving 112% in the price to rent ratio between January and July and Las Vegas becoming the most affordable of the 50 largest cities.
Interest rates are at historic lows but with unemployment not improving substantially, the market remains uncertain. Trulia has analyzed unemployment, job growth, foreclosures, job competition, list price and rent price along with the rent to buy ratio on Trulia Insights, where they graph all of this data in an interactive page.
Ruthmarie Hicks
August 16, 2011 at 4:04 pm
Interesting – I notice NYC it is more expensive to buy than to rent – yet it looks like coops and condos are selling well. In Westchester the balance has shifted to buying over renting by of a substantial margin that I expected buyers to crawl out of the woodwork. Not so….but everyone is buying in the city where it is still cheaper to rent….go figure….
It shows that common sense is often lacking and that there really is a lemming effect.
earth homes
August 16, 2011 at 8:22 pm
Yes, it's finally gotten to the point where buying is as affordable as renting so those waiting in the wings can now take the leap into a new home – that is if the banks are willing to lend.
Travel Mom
August 16, 2011 at 10:31 pm
My house just dropped $20,000 in value this year. I can see why buying now is cheaper than renting. 🙂 There are lots of great homes by me that are steals and great rates. But the fear is scaring people off.
Manhattan Beach Realtor
August 17, 2011 at 9:43 am
It's this affordability, rent-vs-buy price point that turns most market tides. I still think consumers have some more balance sheet repair ahead, but early stage buyers, and investors are chipping away at inventory in the healthier real estate markets.