Renting Still Cheaper Than Owning In Major U.S. Markets, Despite Low Mortgage Rates

With interest rates hovering near historic lows, it might seem like the ideal time for renters to jump into the homeownership market and perhaps spend less money each month to own a home than they do to rent one. But a new report shows that scenario may be more fantasy than reality – at least in the country’s biggest markets. The average monthly cost of owning a home is 28% higher than renting in major U.S. markets, according to a recent report by Robert W. Baird & Co. Of 28 U.S. markets surveyed, only four showed it was cheaper to own a home than rent one, the report said. “Home prices have gotten close to what we saw at the peak of the market,” said Robert Rulla, a director at Fitch Ratings. “The magnitude of home price increases has been higher than rental increases.”

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