It’s cheaper to own a home than it is to rent one in 42 states, with renting more affordable in only eight states and the District of Columbia.
LOS ANGELES – July 20, 2016 – Personal finance website GOBankingRates.com released a guide detailing how monthly rent compares to monthly mortgage payments across the U.S.
To see the price breakdown for all U.S. states, visit the GOBankingRates website.
The bottom line: It's cheaper to own a home than it is to rent one in 42 states, with renting more affordable in only eight states and the District of Columbia.
According to GOBankingRates.com, the average savings enjoyed by homeowners in Florida is $398 per month. In its five-stage ranking system – a lot more to own, a little more to own, about the same, a little more to rent and a lot more to rent – Florida is one of 24 states in the "a lot more to rent" category.
"The good news is mortgage rates are near historic lows," says Kristen Bonner, lead researcher on the study. "Unfortunately, Americans are still running into road blocks with being able to save enough money to afford a downpayment, and are therefore forced to rent."
The study compared median rent prices for single-family homes against the median list price of homes in each state. GOBankingRates assumed a 20 percent downpayment for the median list price and applied a 30-year fixed-rate loan term. It also included the cost of property taxes and insurance.
States where renting is cheaper than owning
- Hawaii: $515 (average monthly savings for renters vs. owners)
- Montana: $248
- Utah: $242
- Idaho: $204
- District of Columbia: $144
- Colorado: $137
- Wyoming: $99
- Delaware: $75
- Oregon: $12
Top 10 places where owning is cheaper than renting
- New York: $1,635
- Massachusetts: $559
- Illinois: $522
- New Jersey: $472
- Pennsylvania: $461
- Florida: $398
- Maine: $396
- Ohio: $375
- Alaska: $334
- Rhode Island: $334
© 2016 Florida Realtors®. All rights reserved. Reprinted with permission.