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The top 5 metros with the largest savings for renters include Austin, Texas; Seattle; Phoenix; San Francisco and Los Angeles

SANTA CLARA, Calif., March 26, 2024 /PRNewswire/ -- Elevated mortgage interest rates, still-high home prices and falling rents have made it more affordable to rent than buy in all of the top 50 U.S. metros, according to the Realtor.com^® Rental Report released today. In February, the mortgage payment on a starter home in the largest metros cost $1,027 (+60.1%) more than the monthly rent in those markets, on average. At the same time last year, 45 metros favored renting.

The top 10 metros with the largest rent versus buy savings (see below for top 50 metros):
1. Austin-Round Rock-Georgetown, Texas - $2,165 monthly rent savings (141.5% difference)
2. Seattle-Tacoma-Bellevue, Wash. - $2,422 (121.1%)
3. Phoenix-Mesa-Chandler, Ariz. - $1,528 (99.0%)
4. San Francisco-Oakland-Berkeley, Calif. - $2,689 (95.5%)
5. Los Angeles-Long Beach-Anaheim, Calif. - $2,539 (89.7%)
6. San Jose-Sunnyvale-Santa Clara, Calif. - $2,780 (86.7%)
7. Nashville-Davidson-Murfreesboro-Franklin, Tenn. - $1,366 (86.0%)
8. Portland-Vancouver-Hillsboro, Ore. Wash. - $1,396 (84.4%)
9. Sacramento-Roseville-Folsom, Calif. - $1,514 (82.1%)
10. Houston-The Woodlands-Sugar Land, Texas - $1,103 (80.0%)

"With rents continuing to fall and the cost of buying a home remaining high, exacerbated by the rise in mortgage rates in the later half of 2023, renting a home is now a more cost-effective option in all major U.S. markets," said Danielle Hale, Chief Economist at Realtor.com^®. "Deciding whether to rent or buy often goes beyond a financial advantage though, and likely depends on a consumer's circumstances. Renters often prize flexibility while the biggest reasons homebuyers cite are that they want a place of their own and to be closer to family and friends. The financial scales have tipped monthly costs in favor of renting over buying, but it does not bring the benefit of housing wealth gains over time that owning does and movers should consider their long-term housing plans and personal situation as they make this decision."

The overall advantage of renting continues to grow in most markets
In February, the cost of buying a starter home in the top 50 metros was $1,027 (60.1%) higher than renting one; comparatively, the cost to buy was $865 higher than renting in February 2023 - a $162 higher monthly savings from renting compared to the prior year. The savings are mostly driven by declining rent prices and higher buying costs, especially interest rates - the 30-year fixed mortgage rate remained elevated at 6.78% in February 2024 compared to 6.26% 12 months ago.

The advantages of renting have become more pronounced across the top metros. Looking specifically at the top 10 metros that favor renting over buying, the average monthly costs for buying a starter home were $1,950 (95.6%) higher than rents - nearly double the cost. Those metros are mostly markets with a higher concentration of tech workers and high earners, where both the average rent and buy costs are higher than the national average.

Renting beats buying in all major metros, especially in south and west; five metros flip from last year
In February, median rents fell across all unit sizes. Despite seven months of annual rent declines, median rents are still $252 (17.3%) higher than the same time in 2020, before the onset of the pandemic. Last February, 45 metros favored renting, but over the past 12 months Memphis, Tenn, Birmingham, Ala., Pittsburgh, St. Louis and Baltimore metros flipped from favoring buying to favoring renting. Four out of five of those markets were among the top markets seeing a high share of investor activity, which may have accelerated the growth of home prices there and increased the overall costs of buying a home, tilting those markets further toward favoring renting over buying.

Austin, Texas, where the monthly cost of buying a starter home was $3,695 - 141.5% more than the monthly rent of $1,530, for a monthly savings of $2,165 - topped the list of markets most favoring renting. Other top markets favoring renting over buying were Seattle, Phoenix, San Francisco and Los Angeles. Metros with diminishing rental advantages were San Jose, Calif.; Dallas; San Francisco; Columbus, Ohio; Miami; and Minneapolis.

Realtor.com^®'s rent versus buy calculator can help consumers determine if the cost of homeownership is a better deal than renting based on their location and budget.

National Rental Data - February 2024

Unit Size	Median Rent	Rent YoY	Rent Change - February 2020
Overall	$1,708	-0.4 %	17.3 %
Studio	$1,426	-1.5 %	10.4 %
1-bed	$1,587	-0.4 %	16.8 %
2-bed	$1,889	-0.8 %	19.3 %

Markets ranked by % of saving from buying vs renting a starter home - February 2024

Metro	Median Rent	Monthly Buy Cost	$ Difference (Buy-Rent)	% Difference (Buy-Rent)	Rent Cost: YoY	Buy Cost: YoY
Austin-Round Rock, TX	$1,530	$3,695	$2,165	141.5 %	-4.4 %	-1.6 %
Seattle-Tacoma-Bellevue, WA	$2,000	$4,422	$2,422	121.1 %	0.4 %	5.6 %
Phoenix-Mesa-Scottsdale, AZ	$1,543	$3,071	$1,528	99.0 %	-3.8 %	13.9 %
San Francisco-Oakland-Hayward, CA	$2,815	$5,504	$2,689	95.5 %	-1.5 %	-1.3 %
Los Angeles-Long Beach-Anaheim, CA	$2,830	$5,369	$2,539	89.7 %	0.7 %	10.7 %
San Jose-Sunnyvale-Santa Clara, CA	$3,206	$5,986	$2,780	86.7 %	2.1 %	-0.8 %
Nashville-Davidson-Murfreesboro- Franklin, TN	$1,589	$2,955	$1,366	86.0 %	-4.1 %	15.8 %
Portland-Vancouver-Hillsboro, OR-WA	$1,655	$3,051	$1,396	84.4 %	-0.9 %	-0.1 %
Sacramento-Roseville-Arden- Arcade, CA	$1,845	$3,359	$1,514	82.1 %	1.1 %	2.3 %
Houston-The Woodlands-Sugar Land, TX	$1,379	$2,482	$1,103	80.0 %	1.2 %	2.6 %
Dallas-Fort Worth-Arlington, TX	$1,491	$2,674	$1,183	79.3 %	-2.1 %	-2.8 %
Boston-Cambridge-Newton, MA-NH	$2,985	$5,289	$2,304	77.2 %	3.1 %	5.7 %
Columbus, OH	$1,181	$2,083	$902	76.4 %	-1.9 %	-2.2 %
New York-Newark-Jersey City, NY-NJ-PA	$2,852	$4,995	$2,143	75.1 %	5.4 %	9.8 %
Richmond, VA	$1,491	$2,598	$1,107	74.2 %	-0.4 %	36.2 %
San Diego-Carlsbad, CA	$2,822	$4,848	$2,026	71.8 %	2.5 %	3.6 %
Denver-Aurora-Lakewood, CO	$1,911	$3,223	$1,312	68.7 %	-0.5 %	0.2 %
Raleigh, NC	$1,507	$2,506	$999	66.3 %	-3.0 %	15.2 %
Minneapolis-St Paul-Bloomington, MN-WI	$1,481	$2,429	$948	64.0 %	-1.5 %	-1.0 %
Jacksonville, FL	$1,518	$2,417	$899	59.2 %	-2.6 %	7.7 %
San Antonio-New Braunfels, TX	$1,264	$2,012	$748	59.2 %	-0.4 %	-0.2 %
Oklahoma City, OK	$982	$1,528	$546	55.6 %	1.3 %	8.2 %
Las Vegas-Henderson-Paradise, NV	$1,488	$2,299	$811	54.5 %	-1.8 %	3.2 %
Atlanta-Sandy Springs-Roswell, GA	$1,613	$2,453	$840	52.1 %	-4.1 %	5.3 %
Washington-Arlington-Alexandria,DC-VA-MD-WV	$2,200	$3,330	$1,130	51.4 %	1.6 %	1.8 %
Cincinnati, OH-KY-IN	$1,320	$1,995	$675	51.1 %	1.0 %	7.7 %
Milwaukee-Waukesha-West Allis, WI	$1,561	$2,324	$763	48.9 %	-1.8 %	2.4 %
Tampa-St. Petersburg-Clearwater, FL	$1,732	$2,572	$840	48.5 %	-1.4 %	3.7 %
Riverside-San Bernardino-Ontario, CA	$2,189	$3,236	$1,047	47.8 %	-0.3 %	5.8 %
Chicago-Naperville-Elgin, IL-IN-WI	$1,825	$2,594	$769	42.1 %	3.7 %	9.9 %
Charlotte-Concord-Gastonia, NC-SC	$1,529	$2,142	$613	40.1 %	-1.1 %	8.6 %
Miami-Fort Lauderdale-West Palm Beach, FL	$2,373	$3,296	$923	38.9 %	-3.4 %	-2.9 %
Indianapolis-Carmel-Anderson, IN	$1,297	$1,752	$455	35.1 %	3.6 %	14.7 %
Louisville/Jefferson County, KY-IN	$1,218	$1,606	$388	31.9 %	0.8 %	19.9 %
Orlando-Kissimmee-Sanford, FL	$1,675	$2,190	$515	30.7 %	-2.7 %	1.3 %
Philadelphia-Camden-Wilmington, PA-NJ-DE-MD	$1,786	$2,324	$538	30.1 %	-0.8 %	5.4 %
Virginia Beach-Norfolk-Newport News, VA-NC	$1,501	$1,864	$363	24.2 %	-1.0 %	12.6 %
Kansas City, MO-KS	$1,319	$1,553	$234	17.7 %	2.7 %	3.1 %
Detroit-Warren-Dearborn, MI	$1,302	$1,528	$226	17.4 %	-0.4 %	8.4 %
Cleveland-Elyria, OH	$1,249	$1,436	$187	15.0 %	-1.5 %	5.7 %
Birmingham-Hoover, AL	$1,241	$1,415	$174	14.0 %	-1.8 %	30.1 %
Baltimore-Columbia-Towson, MD	$1,783	$1,974	$191	10.7 %	-1.6 %	10.0 %
St. Louis, MO-IL	$1,300	$1,400	$100	7.7 %	-3.9 %	8.3 %
Memphis, TN-MS-AR	$1,251	$1,279	$28	2.2 %	-5.0 %	34.8 %
Pittsburgh, PA	$1,425	$1,444	$19	1.3 %	1.8 %	16.5 %

* Buffalo, N.Y.; Hartford, Conn.; New Orleans; Providence, R.I.; and Rochester, N.Y. area metrics have been excluded while data is under review

Methodology
Rental data as of February 2024 for studio, 1-bedroom, or 2-bedroom units advertised as for-rent on Realtor.com®. Rental units include apartments as well as private rentals (condos, townhomes, single-family homes). We use rental sources that reliably report data each month within the top 50 largest metropolitan areas. Realtor.com® began publishing regular monthly rental trends reports in October 2020 with data history stretching back to March 2019.

The monthly cost of buying a home was calculated by averaging the median listing prices of studio, 1-bed, and 2-bed homes, weighted by the number of listings, in each housing market. Monthly buying costs assume a 8% down payment, with a mortgage rate of 6.78%, and include taxes, insurance and HOA fees.

With the release of its January 2024 rent report, Realtor.com® incorporated a new and improved methodology for capturing and reporting more comprehensive rental listing trends and metrics. The new methodology is expected to yield a cleaner, more representative and more consistent measurement of rental listings and trends at both the national and local level. The methodology has been adjusted to better represent the true cost of primary housing for renters. Most areas across the country will see minor changes with a smaller handful of areas seeing larger updates. As a result of these changes, the rental data released since January 2024 will not be directly comparable with previous releases and Realtor.com® economics blog posts. However, future data releases, including historical data, will consistently apply the new methodology.

About Realtor.com^®Realtor.com^® is an open real estate marketplace built for everyone. Realtor.com^® pioneered the world of digital real estate more than 25 years ago. Today, through its website and mobile apps, Realtor.com^® is a trusted guide for consumers, empowering more people to find their way home by breaking down barriers, helping them make the right connections, and creating confidence through expert insights and guidance. For professionals, Realtor.com^® is a trusted partner for business growth, offering consumer connections and branding solutions that help them succeed in today's on-demand world. Realtor.com^® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. For more information, visit Realtor.com^®.

Media contact:
Sara Wiskerchen, press@realtor.com

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SOURCE Realtor.com