The real estate site Trulia just published their detailed annual study regarding the dollar relationship between renting and buying a home in these United States… and, the numbers are startling! For example, in Detroit there’s a 70% advantage to buying versus renting.
Buying cheaper in every large metro area
Buying is cheaper than renting by several hundred dollars a month in every large metro. Yes, every large city. While the percent difference in buying versus renting may be smaller in San Francisco (-28%) than in almost all other metros, the annual dollar savings is big ($899) because the rents and home prices there are so high – even a smaller percentage difference means a big dollar difference.
- Can get a low mortgage rate of 3.5%,
- Itemize their federal tax deductions,
- Are in the 25% tax bracket, and,
- Plan to stay in their home for seven years.
Click for a great interactive map.
The cost of homeownership assumes the home is sold after 7 years, and includes the closing costs, maintenance, insurance, property taxes and other costs. Cost of renting includes security deposit and renters’ insurance. Monthly cost is based on net present value of costs over 7 years, and on the average across all properties listed in the metro area, including those for sale and those for rent, in summer 2012.
Oh, and, by the way, anyone out there really think that rents won’t continue to rise?!