Renting vs Buying a Home: Which is Better?
Buying A Home

Renting vs Buying a Home: Which is Better?

Written by Rebecca Lake

With mortgage rates still hovering near all-time lows and the housing market slowly beginning to heat up, you could easily argue that there’s never been a better time for buying a home.

Thanks to tighter lending restrictions, however, and an economy that’s still largely in recovery mode, the American dream of owning a home has changed somewhat for many would-be buyers.

The number of people choosing to rent rather than buy has surged over the past few years and as of 2013, there were about 43 million renter households in the U.S.
While there are some definite advantages that go along with renting, rising demand for properties has pushed rental rates to new highs. Nearly half of middle-income renters are shelling out 30% or more of their pay on housing.

With the cost gap between renting and buying a home narrowing, it’s worth wondering if it’s time to make the leap into home ownership. Here are a few important things worth thinking about when you’re considering renting or buying a home.

How the cost compares

Whether it’s cheaper to rent or buy is really subjective and it depends on several factors, starting with where you live.

According to Trulia’s 2014 Rent vs. Buy Report, owning a home is actually 38% cheaper than renting on average, at least in the nation’s 100 largest metro areas. While that seems like a pretty big difference, the numbers vary when you take a closer look. In Detroit, for example, buying is actually 66% cheaper compared to just 5% in Honolulu.

About the author

Rebecca Lake

Rebecca Lake is a personal finance writer and blogger specializing in topics related to mortgages, retirement and business credit. Her work has appeared in a variety of outlets around the web, including Smart Asset and Money Crashers. You can find her on Twitter at @seemomwrite or her website, RebeccaLake.net.

7 Comments

  • Good article. Bad examples. Neither Detroit nor Honolulu is at the top of the list for home seekers. Florida is, and so are other States and regions in a State. The article should have focused on the areas that would have the highest impact.

  • Hi my name is Leslie and I was interested in seeing about your program and was wondering if you had any home with rent to own or owner will carry I do have credit issues and I trying to get them trying to pay them .

  • Hi Ms. Lake – I am
    seriously thinking of selling and moving to another location due some stalking matter. How should I go about it? I need to sell the house as is, that means lost. Please advise.

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