The real estate market has exploded since the pandemic hit last year. The supply withered and the geographical patterns shifted. House prices soared as borrowers tried to take advantage of the rock-bottom mortgage rates.
The market of 2021 started off hot and consumers are having to weigh the economics between buying or renting. However, some subway areas offer better options to potential buyers, especially since the interest rates are close to 3% and combine with the efforts of the Biden administration to help first-time home buyers.
According to a report by Realtor.com, 15 of the top 50 US real estate markets offer cheaper monthly payments for a mid-size home than renting a similar property.
"This is encouraging news for the millions of millennials who are approaching the age limit to buy a home and may be considering buying a home this spring," Realtor.com Chief Economist Danielle Hale said in the report Months buyers may need to act sooner rather than later to take advantage of today's affordability, or be ready to adjust their target purchase price. "
And at the other end of the spectrum, the graph below shows the top seven cities where it's cheaper to rent than to buy.
Realtor.com based its March analysis of the 50 largest metros by total households. The monthly acquisition costs were based on a 30-year fixed-rate mortgage with a down payment of 20% and included taxes and insurance. A monthly purchase to rent ratio below 100% means that the purchase is more beneficial for consumers.
From the Keystone State to the Rust Belt, local lenders in the top 12 cities where it is cheaper to buy are discussing what affects current affordability uniquely in their respective markets.