Buying a Home Is Now 38 Percent Cheaper Than Renting

According to Trulia chief economist Jed Kolko’s latest research, homeownership remains 38 percent cheaper than leasing. Trulia’s Winter 2014 Rent vs. Buy Report shows that homeownership continues to be cheaper than renting nationally and in all of the 100 biggest metro areas. Higher borrowing costs and property prices have narrowed the gap over the last year, although rates have recently dipped and price gains are slowing. Kolko notes that purchasing ranges from being only 5 percent cheaper than renting in Honolulu to being a whopping 66 percent more affordable than renting in Detroit. Not far behind the Motor City was Gary, Ind. (61 percent); Birmingham, Ala. (58 percent); and Toledo, Ohio (also 58 percent). Nationally, rates would have to climb to 10.6 percent — a level that has not been seen since 1989 — in order for renting to be cheaper than buying. | Read More