Renting is Still More Affordable than Buying in All but Two Major U.S. Metros
Wednesday, February 19th, 2025
Most metros have become more affordable for both buyers and renters in the past year; however, renting a median-priced unit is still more affordable for median wage earners than buying the median priced for-sale listing in all major U.S. metros except Detroit and Pittsburgh, according to the Realtor.com® January Rent Report. Last January there were six markets where buying was less expensive than renting, which shows the impact of the consistent retreat of rental prices and the persistence of high mortgage rates. Over the past year, the market as a whole has moved in a more renter-friendly direction.
"For most Americans owning a home is still a big part of the American Dream, yet the lower monthly costs of renting in all but 2 of the 50 largest markets are a key consideration," said Danielle Hale, chief economist, Realtor.com®. "This relative cost advantage is one of the reasons we expect an increase in renter households and declines in the homeownership rate in 2025."
Why is it More Affordable to Buy in Detroit and Pittsburgh?
Pittsburgh and Detroit are the two metros with the lowest median listing prices of our top 50 metros, with Pittsburgh at $229,700 and Detroit at $239,950. These Rust Belt metros are often among our most affordable ones when it comes to buying a home, and with the share of income used on rent increasing year over year in Detroit and remaining nearly flat in Pittsburgh, buying a home has actually become more economical than renting one.
Is Renting Finally as Affordable as Before the Pandemic?
Even though rents are falling, renters are still feeling the pinch from the rapid rent growth of 2021 and 2022. While January 2025's rent figure is lower than both January 2024 and January 2023's, it still exceeds January 2020 by $257 (16.1%).
Buy or Rent Favoring… Which Markets Fall Where?
While renting remains more affordable than buying across most metros, this report looks at the relationship among wage growth, mortgage rates, median rent and media listing price to see which metros are rent-favoring and which metros are buy- favoring.
Three metros–New York; San Jose, Calif.; and Detroit–are the only metros where the share of income used on both rent and buying a home are growing. In these metros it takes more income to both rent the median priced rental unit and buy a median priced home, becoming both less renter and less buyer-favoring.
One metro, Kansas City, Kan., is becoming more buyer-favoring. In Kansas City, a higher share of income is spent on rents and a lower share of income on buying. There are 18 metros that have become rent-favoring and where more of the median earner's income is needed to buy a home than a year ago.
Metros Becoming More Renter-Friendly and Less Buyer-Friendly
|
Metro |
Percent of Income Spent on |
Percent of Income Spent |
|
Baltimore-Columbia-Towson, MD |
2.2 % |
-0.4 % |
|
Boston-Cambridge-Newton, MA-NH |
1.0 % |
-0.2 % |
|
Charlotte-Concord-Gastonia, NC-SC |
1.4 % |
-1.4 % |
|
Chicago-Naperville-Elgin, IL-IN |
0.2 % |
-1.4 % |
|
Houston-Pasadena-The Woodlands, |
0.2 % |
-1.3 % |
|
Las Vegas-Henderson-North Las |
0.5 % |
-1.9 % |
|
Los Angeles-Long Beach-Anaheim, CA |
1.2 % |
-1.8 % |
|
Memphis, TN-MS-AR |
0.4 % |
-2.4 % |
|
Milwaukee-Waukesha, WI |
3.0 % |
-0.1 % |
|
Minneapolis-St. Paul-Bloomington, MN- |
0.6 % |
-0.4 % |
|
Philadelphia-Camden-Wilmington, PA- |
1.4 % |
-0.9 % |
|
Pittsburgh, PA |
0.6 % |
-0.3 % |
|
Portland-Vancouver-Hillsboro, OR-WA |
0.3 % |
-0.7 % |
|
Riverside-San Bernardino-Ontario, CA |
1.8 % |
-2.1 % |
|
Virginia Beach-Chesapeake-Norfolk, |
1.9 % |
-0.4 % |
National Rental Data – January 2025
|
Unit Size |
Median Rent |
Rent YoY |
Rent Change - 5 |
|
Overall |
$1,703 |
-0.2 % |
16.1 % |
|
Studio |
$1,423 |
0.0 % |
11.4 % |
|
1-Bedroom |
$1,585 |
-0.1 % |
16.0 % |
|
2-Bedroom |
$1,887 |
-0.2 % |
20.0 % |
50 Largest Metropolitan Areas – January 2025
|
Metro |
Median Rent |
YoY Change |
Share of |
Share of |
|
Atlanta-Sandy Springs-Roswell, GA |
$1,565 |
-2.9 % |
21.4 % |
28.4 % |
|
Austin-Round Rock-San Marcos, TX |
$1,467 |
-4.8 % |
17.2 % |
30.3 % |
|
Baltimore-Columbia-Towson, MD |
$1,786 |
0.1 % |
22.5 % |
23.1 % |
|
Birmingham, AL |
$1,201 |
-2.9 % |
20.1 % |
24.9 % |
|
Boston-Cambridge-Newton, MA-NH |
$2,925 |
0.5 % |
32.1 % |
45.8 % |
|
Buffalo-Cheektowaga, NY |
NA |
NA |
NA |
NA |
|
Charlotte-Concord-Gastonia, NC-SC |
$1,520 |
-1.2 % |
22.4 % |
32.3 % |
|
Chicago-Naperville-Elgin, IL-IN |
$1,776 |
-3.6 % |
24.6 % |
24.8 % |
|
Cincinnati, OH-KY-IN |
$1,326 |
-0.7 % |
19.9 % |
25.0 % |
|
Columbus, OH |
$1,184 |
0.7 % |
17.7 % |
26.5 % |
|
Dallas-Fort Worth-Arlington, TX |
$1,445 |
-3.5 % |
19.5 % |
29.3 % |
|
Denver-Aurora-Centennial, CO |
$1,796 |
-5.6 % |
20.2 % |
33.4 % |
|
Detroit-Warren-Dearborn, MI |
$1,313 |
1.3 % |
21.7 % |
20.7 % |
|
Hartford-West Hartford-East Hartford, CT |
NA |
NA |
NA |
NA |
|
Houston-Pasadena-The Woodlands, TX |
$1,359 |
-1.8 % |
20.7 % |
28.5 % |
|
Indianapolis-Carmel-Greenwood, IN |
$1,280 |
-1.7 % |
19.3 % |
23.6 % |
|
Jacksonville, FL |
$1,510 |
-1.0 % |
22.1 % |
29.4 % |
|
Kansas City, MO-KS |
$1,352 |
4.2 % |
20.3 % |
29.3 % |
|
Las Vegas-Henderson-North Las Vegas, |
$1,457 |
-2.2 % |
24.1 % |
40.4 % |
|
Los Angeles-Long Beach-Anaheim, CA |
$2,736 |
-2.6 % |
35.9 % |
74.7 % |
|
Louisville/Jefferson County, KY-IN |
$1,244 |
0.5 % |
20.6 % |
26.4 % |
|
Memphis, TN-MS-AR |
$1,177 |
-4.3 % |
21.1 % |
30.8 % |
|
Miami-Fort Lauderdale-West Palm Beach, |
$2,328 |
-1.9 % |
37.6 % |
43.9 % |
|
Milwaukee-Waukesha, WI |
$1,611 |
-0.2 % |
26.1 % |
30.6 % |
|
Minneapolis-St. Paul-Bloomington, MN-WI |
$1,507 |
0.2 % |
18.7 % |
27.5 % |
|
Nashville-Davidson--Murfreesboro-- |
$1,539 |
-2.5 % |
21.7 % |
38.6 % |
|
New Orleans-Metairie, LA |
NA |
NA |
NA |
NA |
|
New York-Newark-Jersey City, NY-NJ |
$2,973 |
5.8 % |
37.6 % |
49.5 % |
|
Oklahoma City, OK |
$1,021 |
1.5 % |
17.1 % |
27.4 % |
|
Orlando-Kissimmee-Sanford, FL |
$1,676 |
0.0 % |
26.8 % |
35.1 % |
|
Philadelphia-Camden-Wilmington, PA-NJ- |
$1,754 |
-0.5 % |
23.8 % |
24.9 % |
|
Phoenix-Mesa-Chandler, AZ |
$1,488 |
-3.5 % |
20.4 % |
36.6 % |
|
Pittsburgh, PA |
$1,431 |
0.2 % |
23.5 % |
19.7 % |
|
Portland-Vancouver-Hillsboro, OR-WA |
$1,665 |
-0.3 % |
21.1 % |
39.6 % |
|
Providence-Warwick, RI-MA |
NA |
NA |
NA |
NA |
|
Raleigh-Cary, NC |
$1,486 |
-2.3 % |
18.2 % |
28.1 % |
|
Richmond, VA |
$1,481 |
-0.3 % |
20.3 % |
30.2 % |
|
Riverside-San Bernardino-Ontario, CA |
$2,065 |
-4.1 % |
28.8 % |
43.6 % |
|
Rochester, NY |
NA |
NA |
NA |
NA |
|
Sacramento-Roseville-Folsom, CA |
$1,885 |
1.0 % |
24.2 % |
41.1 % |
|
San Antonio-New Braunfels, TX |
$1,238 |
-2.1 % |
20.3 % |
27.8 % |
|
San Diego-Chula Vista-Carlsbad, CA |
$2,695 |
-4.8 % |
31.4 % |
57.7 % |
|
San Francisco-Oakland-Fremont, CA |
$2,708 |
-3.3 % |
24.3 % |
41.4 % |
|
San Jose-Sunnyvale-Santa Clara, CA |
$3,287 |
2.4 % |
25.2 % |
50.7 % |
|
Seattle-Tacoma-Bellevue, WA |
$1,969 |
-0.2 % |
20.8 % |
40.1 % |
|
St. Louis, MO-IL |
$1,316 |
1.4 % |
19.8 % |
21.6 % |
|
Tampa-St. Petersburg-Clearwater, FL |
$1,710 |
-1.6 % |
28.1 % |
34.0 % |
|
Virginia Beach-Chesapeake-Norfolk, VA-NC |
$1,494 |
-0.8 % |
22.3 % |
30.4 % |
|
Washington-Arlington-Alexandria, DC-VA- |
$2,247 |
2.3 % |
21.9 % |
29.3 % |
