A new report released by John Burns Real Estate Consulting earlier this month revealed that having a mortgage costs, on average, $839 more per month than having a lease, making renting the more affordable option for most Americans. The cost of homeownership is 31% higher than renting nationwide, but in overpriced metropolitan areas seeing record growth, that gap is far wider, The New York Times reports.
The good news is that as more buyers are priced out of home purchases in an inflated market, home sales are slowing, and experts say that home price growth could soon follow a similar trajectory. In the meantime, an already booming rental market could see even more substantial growth that will leave priced out buyers and renters with few options for affordable housing.
Nationally, the cost of owning is 31 percent higher than renting, but the disparity is greater in metropolitan areas where housing prices have surged, the report said. In the Raleigh-Durham area in North Carolina, for example, the cost of owning was 42 percent higher than renting in April. The gap was 40 percent in Nashville, 38 percent in Denver and 35 percent in Tampa, Fla., and Phoenix.
Advertisement
Related Stories
Affordability
As Demand Weakens, Home Sellers Are Cutting Prices
The median asking price dropped by $3,000 in May, but home prices and mortgage rates remain high
Market Data + Trends
Home Prices Are Beginning to Cool Down
By July, the annual growth rate is projected to be just 4% year-over-year, but shifting supply and demand levels could change this estimate
New-Home Sales
More Than Half of All Homebuyers Say They Prefer New Homes
This trend comes as the price gap between new and existing homes narrows
