SANTA CLARA, California
,
January 26, 2023
(press release)
–
The top markets with the largest savings for renters include: Austin, Texas (121.3% savings), San Francisco (97.0% savings) and Seattle (86.1% savings) For many Americans hoping to make the transition to first-time buying in 2023, renting will likely offer relatively more affordable options in the months ahead, according to the Realtor.com® Monthly Rental Report released today. On average across the 50 largest U.S. metros in December, a typical renter faced a 41.4% ($792) lower monthly payment than a starter homeowner.1 The markets with the largest monthly savings for renters, ranked by the percent difference between monthly mortgage payments and asking rents, include: "Despite the fact that renting will likely be cheaper than buying in 2023, rental affordability will remain a key issue throughout the year. We expect rents will keep hitting new highs, driven by factors including still-low vacancy rates, lagging new construction and demand from would-be first-time buyers," said Realtor.com® Chief Economist Danielle Hale. "For prospective first-time buyers, the key consideration when figuring out whether to buy or rent is how long you plan to live in your next home. If you're looking for flexibility to move in the shorter term, renting may be your best bet, and still offer opportunities to save if you're able to compromise on factors like proximity to the downtown area. Whereas buying could be the better option if you're planning to stay put for at least five years. Market conditions will play a role, but ultimately the timing comes down to your personal situation, and tools like the Realtor.com® Rent vs. Buy Calculator can help you organize and make sense of the many considerations." In December, renters faced lower monthly costs than first-time buyers, on average across the 50 largest U.S. metros and in the vast majority (45) of these markets. Additionally, the gap between the cost of renting and buying a similar-sized home widened significantly compared to December 2021. While this was partly attributed to the slowdown in rent growth seen over the past year, December trends indicate that the increase in relative rental affordability was primarily driven by skyrocketing mortgage rates. December & Full-Year 2022 Rental Metrics – National Unit Size Dec. 2022 Dec. 2022 Median Rent, Full-Year 2022 Avg. YY Overall $1,712 3.2 % 11.6 % Studio $1,448 4.7 % 13.2 % 1-bed $1,589 2.9 % 11.3 % 2-bed $1,874 2.4 % 10.9 % December & Full-Year 2022 Rental Metrics – 50 Largest U.S. Metro Areas Rank Metro Area December 2022 Full- Buy-Rent Buy-Rent Overall Overall YY Monthly Monthly Overall 1 121.3 % $2,013 $1,659 -0.7 % $3,672 31.1 % 9.2 % 2 97.0 % $2,855 $2,943 3.4 % $5,798 34.7 % 9.3 % 3 86.1 % $1,772 $2,059 1.2 % $3,831 57.3 % 11.0 % 4 83.0 % $2,621 $3,156 5.9 % $5,777 39.6 % 13.7 % 5 77.2 % $2,085 $2,702 1.2 % $4,787 51.3 % 15.7 % 6 74.9 % $2,150 $2,870 2.3 % $5,020 37.7 % 13.0 % 7 73.1 % $2,097 $2,868 6.4 % $4,965 32.8 % 19.8 % 8 71.2 % $1,246 $1,750 4.7 % $2,996 34.8 % 9.1 % 9 70.1 % $1,116 $1,592 -3.3 % $2,708 36.6 % 10.4 % 10 67.7 % $1,241 $1,834 -4.2 % $3,075 32.9 % 5.2 % 11 66.4 % $887 $1,335 4.5 % $2,222 41.7 % 8.7 % 12 66.1 % $1,024 $1,549 6.7 % $2,573 71.5 % 8.6 % 13 63.5 % $1,207 $1,902 0.8 % $3,109 27.2 % 9.0 % 14 62.4 % $853 $1,368 1.7 % $2,221 31.7 % 8.7 % 15 57.2 % $895 $1,564 3.4 % $2,459 27.1 % 14.1 % 16 57.0 % $913 $1,602 2.5 % $2,515 32.0 % 14.3 % 17 57.0 % $1,537 $2,698 12.2 % $4,235 10.2 % 15.4 % 18 55.3 % $684 $1,237 5.4 % $1,921 34.4 % 9.4 % 19 54.6 % $817 $1,495 -4.5 % $2,312 34.0 % 11.9 % 20 53.4 % $691 $1,294 3.6 % $1,985 41.1 % 13.7 % 21 52.2 % $739 $1,417 -0.7 % $2,156 11.7 % 7.7 % 22 50.8 % $776 $1,527 2.5 % $2,303 37.9 % 3.8 % 23 50.7 % $1,066 $2,103 3.7 % $3,169 35.0 % 9.3 % 24 45.5 % $927 $2,037 -6.0 % $2,964 50.7 % 6.0 % 25 44.4 % $657 $1,479 1.6 % $2,136 60.8 % 13.3 % 26 42.0 % $646 $1,537 2.3 % $2,183 29.6 % 14.0 % 27 37.4 % $473 $1,265 7.0 % $1,738 42.2 % 8.5 % 28 37.3 % $771 $2,067 6.7 % $2,838 39.2 % 17.3 % 29 37.2 % $442 $1,188 2.3 % $1,630 25.5 % 6.7 % 30 35.6 % $487 $1,368 6.2 % $1,855 38.3 % 12.1 % 31 34.0 % $567 $1,669 -1.7 % $2,236 35.6 % 14.9 % 32 32.2 % $567 $1,760 -4.3 % $2,327 50.7 % 14.4 % 33 31.5 % $846 $2,682 4.7 % $3,528 40.3 % 29.9 % 34 27.4 % $465 $1,697 0.4 % $2,162 36.5 % 6.8 % 35 25.8 % $245 $950 9.6 % $1,195 25.8 % 11.2 % 36 24.3 % $421 $1,730 7.5 % $2,151 37.8 % 10.2 % 37 22.8 % $250 $1,097 4.3 % $1,347 46.9 % 10.4 % 38 21.5 % $343 $1,592 2.3 % $1,935 45.9 % 12.9 % 39 18.2 % $359 $1,968 17.5 % $2,327 33.7 % 16.5 % 40 15.2 % $218 $1,432 2.4 % $1,650 49.6 % 9.0 % 41 13.5 % $166 $1,227 5.8 % $1,393 30.4 % 6.7 % 42 13.1 % $151 $1,152 5.0 % $1,303 32.8 % 8.2 % 43 11.7 % $212 $1,812 4.0 % $2,024 53.8 % 20.5 % 44 10.9 % $140 $1,288 8.0 % $1,428 39.2 % 10.5 % 45 9.9 % $125 $1,269 9.4 % $1,394 44.0 % 10.2 % 46 -3.7 % -$65 $1,749 2.6 % $1,684 25.4 % 8.4 % 47 -6.9 % -$83 $1,211 2.7 % $1,128 34.1 % 7.1 % 48 -23.5 % -$270 $1,149 3.6 % $879 19.1 % 7.8 % 49 -24.1 % -$348 $1,445 4.5 % $1,097 21.2 % 7.2 % 50 -32.7 % -$411 $1,258 0.3 % $847 58.3 % 12.4 % Methodology The monthly cost of buying a starter home, also referred to in this release as first-time buying, was calculated by averaging the December median listing prices of studio, 1-bed, and 2-bed homes, weighted by the number of listings, in each housing market (average across the 50 largest U.S. metros: $318,697). Monthly buying costs assume a 7% down payment, with a mortgage rate of 6.36%, and include taxes, insurance and HOA fees. About Realtor.com® Media Contact 1 See methodology for rent vs. buy calculation details. SOURCE Realtor.com
Median Rent
YY Change
Rent Change
Ranked by % difference between rents and monthly starter home payments
Year
2022
Avg.
Difference
(%)
Difference
($)
Median
Rent (0-2
beds)
Rent
Starter
Home
Cost
Starter
Home
Cost YY
Rent YY
Rental data as of December 2022 for units advertised as for-rent on Realtor.com®. Rental units include apartment communities as well as private rentals (condos, townhomes, single-family homes). All units were studio, 1-bedroom, or 2-bedroom units. National rents were calculated by averaging the medians of the 50 largest U.S. metropolitan areas, as defined by the Office of Management and Budget (OMB). Realtor.com® began publishing regular monthly rental trends reports in October 2020 with data history going back to March 2019.
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