CBRE: Renting Less Expensive Than Mortgage Payments

(Image courtesy of CBRE; Breakout image courtesy of Pixabay/

CBRE, Dallas, released a new report finding average mortgage payments are 38% higher than average apartment rents as of year-end.

Based on its forecasts, the trend of many renters renting for longer is expected to continue for at least the next few years, even as some factors–such as home prices and interest rates–may improve.

Average mortgage payments, including taxes, have risen by 75% since late 2019.

CBRE anticipates a 2.8% annual growth for multifamily rents over the next five years, in line with pre-pandemic numbers.

“The disparity between mortgage payments and rental costs presents a substantial hurdle for aspiring homeowners,” said Matt Vance, Americas Head of Multifamily Research for CBRE. “The sharp increase in the cost of buying a home has made it increasingly difficult for individuals and families to make the transition from renting to owning.”

Additionally, CBRE pointed to a shortage of housing units–along with the “lock-in effect” pushing down supply. CBRE predicted a shortage of 3.8 million housing units in the U.S., primarily in single-family homes and small multi-family units, with the issue persisting until at least 2029.