Buying a home is more cost-effective than renting in two-thirds of the nation’s housing market, according to the 2017 Rental Affordability Report issued by ATTOM Data Solutions.
In a data study of 500 U.S. counties, the report concluded that it is more cost-effective to making monthly house payments on a median-priced home — including mortgage, property taxes and insurance — compared to the fair market rent on a three-bedroom property in 354 counties, or 66 percent of the total markets analyzed in the report. The least affordable rental markets requiring the highest percentage of average wages to pay fair market rent in 2017 are Marin County, Calif., in the San Francisco metro area (77.3 percent); Spotsylvania County, Va. in the Washington, D.C. metro area (73.7 percent); Monroe County (Key West), Fla. (72.2 percent); and Hawaii’s Honolulu County (70.7 percent) and Maui County (70.6 percent).
On the flip side, the most affordable rental markets requiring the lowest percentage of average wages to pay fair market rent in 2017 are Madison County (Huntsville), Ala. (23.9 percent); Allegheny County (Pittsburgh), Pa. (24.4 percent); Fulton County (Atlanta), Ga. (24.8 percent); Anderson County (Knoxville), Tenn. (25.1 percent); and Rock Island County, Ill. (25.3 percent).
“While buying continues to be more affordable than renting in the majority of U.S. markets, that equation could change quickly if mortgage rates keep rising in 2017,” said Daren Blomquist, senior vice president with ATTOM Data Solutions, the new parent company of RealtyTrac. “In that scenario, renters who have not yet made the leap to homeownership will find it even more difficult to make that leap this year. Additionally, renting may end up being the lesser of two housing affordability evils in a growing number of high-priced markets.”