ATTOM: Buying a Home More Affordable than Renting in Majority of Markets
ATTOM Data Solutions, Irvine, Calif., says buying a home is ultimately more affordable than renting in a majority of U.S. housing markets–but not by much.
The company’s 2018 Rental Affordability Report said buying a median-priced home is more affordable than renting a three-bedroom property in 240 of 447 U.S. counties analyzed for the report–just 54 percent. And complicating the matter, 64 percent of the U.S. population lives in markets where it is more affordable to rent than it is to buy.
The analysis incorporated recently released fair market rent data for 2018 from HUD; wage data from the Bureau of Labor Statistics; and public record sales deed data from ATTOM in 447 U.S. counties with sufficient home sales data.
“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 Daren Blomquist, vice president with ATTOM Data Solutions.
Blomquist said 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 one million or more. When broken down by population rather than number of markets, these data show the majority of the U.S. population live in markets that are more affordable to rent than to buy.
The report said renting is more affordable than buying a home in the nation’s 14 most populated counties and in 30 of 39 counties with a population of 1 million or more (76 percent), including Los Angeles County, Calif.; Cook County (Chicago), Ill.; Harris County (Houston), Texas; Maricopa County (Phoenix), Ariz.; and San Diego County, Calif. The report also cited counties in Miami, New York City, Seattle, Las Vegas, San Jose, San Francisco and Boston.
Among U.S. counties with a population of 1 million or more, the nine where it is more affordable to buy a home than rent were Tarrant County (Dallas), Texas; Broward County (Miami), Fla.; Bexar County, (San Antonio) Texas; Wayne County (Detroit), Mich.; Philadelphia County, Pa.; Hillsborough County (Tampa-St. Petersburg), Fla.; Cuyahoga County (Cleveland), Ohio; Allegheny County (Pittsburgh), Pa.; and Saint Louis County, Mo.
Least affordable markets for renting were Marin County, Calif. (79.5 percent of average wages to rent); Spotsylvania County (Washington, D.C. area), Va. (75.5 percent); Honolulu County, Hawaii (71.9 percent); Sonoma County (Santa Rosa area), Calif. (67.6 percent); and Kings County, N.Y. (67.4 percent).
Most affordable markets for renting were Madison County (Huntsville), Ala. (22.3 percent of average wages to rent); Tazewell County (Peoria), Ill. (23.6 percent); Greene County (Dayton), Ohio (24.1 percent); Sullivan County (Kingsport-Bristol), Tenn. (24.2 percent); and Cuyahoga County (Cleveland), Ohio (24.8 percent).
