Sunday, May 1, 2011

Is it Cheaper to Rent or to Buy?

I guess that depends on where you live.  
   In Dallas and its suburbs, you should buy.  However, if you move to Fort Worth, maybe you should rent?  New York City?  Definitely rent.  In fact, Inman News reports that It is cheaper to buy a home than to rent one in 39 of the nation’s 50 largest cities.  Inman cites a a quarterly report released today by real estate search and marketing site Trulia.
   The folks at Trulia have produced a rent vs. buy index that compares the median list price with the median rent on two-bedroom apartments, condominiums and town-homes in the 50 most populous cities in the U.S. listed on as of April 1, 2011. 

   Ken Shuman, Trulia’s spokesperson, stated, “With home prices nearing a double dip and more foreclosures expected to flood the housing market over the next two years, the decision between renting and buying a home across most of the country has clearly moved in favor of buying.
   “As we head into the summer buying season, those looking to buy a home should be encouraged by improvements in the market and feel optimistic about their chances of finding an affordable home — much more so than in previous years.”
   A price-to-rent ratio of 1 to 15 means that it’s much cheaper to buy than to rent in a particular city. 
Top 10 cities to buy vs. rent:
RankCityStatePrice-to-rent ratio
1Las VegasNev.6
   Inman reports that this index considers the total cost of homeownership compared to the total cost of renting. Calculations for total rental cost include rent and renters insurance.  The total cost of homeownership was highest, compared to the cost to rent, in New York; Fort Worth, Texas; and Kansas City, Mo.
Top 10 cities to rent vs. buy:
RankCityStatePrice-to-rent Ratio
50New YorkN.Y.39
49Fort WorthTexas30
48Kansas CityMo.22
47Los AngelesCalif.20
43San FranciscoCalif.19
41Oklahoma CityOkla.16

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