With home prices rising 7 percent year-over-year, renting is often seen as a more affordable alternative to buying. But as ATTOM Data Solutions latest rental affordability report shows, that isn’t necessarily true for a good chunk of the population.
According to ATTOM’s analysis — which includes fair market rent data for 2018 from the U.S. Department of Housing and Urban Development, wage data from the Bureau of Labor Statistics along with public record sales deed information from ATTOM’s database — buying a home is more affordable than renting a three-bedroom property in 240 of 447 U.S. counties (54 percent).
Among the 39 U.S. counties (with a population of 1 million or more) analyzed in the report, nine were found to be more affordable for owners than renters:
Tarrant County (Dallas), Texas
Broward County (Miami), Florida
Bexar County (San Antonio) Texas
Wayne County (Detroit), Michigan
Philadelphia County, Pennsylvania
Hillsborough County (Tampa-St. Petersburg), Florida
Cuyahoga County (Cleveland), Ohio
Allegheny County (Pittsburgh), Pennsylvania
Saint Louis County, Missouri
“Although buying is still more affordable than renting in the majority of U.S. housing markets, that majority is shrinking as home price appreciation continues to outpace rental growth in most areas,” said ATTOM Data Solutions vice president Daren Blomquist in a press release.
“Renting has clearly become the lesser of two housing affordability evils in many major population centers, with renting more affordable than buying in 76 percent of counties that have a population of 1 million or more,” he added. “And when broken down by population rather than number of markets, this data shows that the majority of the U.S. population — 64 percent — live in markets that are more affordable to rent than to buy.”