Why Buying a Home Beats Renting in These Top Cities: A Detailed Look at Monthly Savings

Why Buying a Home Beats Renting in These Top Cities: A Detailed Look at Monthly Savings

If you're wondering whether buying a home or continuing to rent is the smarter financial move, you're not alone. The debate between renting and buying continues to be a hot topic, especially with fluctuating interest rates and home prices. However, a recent study shows that in 22 out of the top 50 metro areas in the U.S., owning a home is more affordable than renting. Let's break down the data, explore specific cities—including Louisville—and see how much you can save by becoming a homeowner.

Monthly Savings: Buying vs. Renting in Top Cities

Here’s a snapshot of some of the cities where owning a home could save you the most money compared to renting:

• New Orleans, LA: Homeowners save an impressive $446 per month compared to renters.
• Chicago, IL: Residents save $434 a month by choosing to buy.
• Pittsburgh, PA: Homeownership leads to a monthly savings of $321.
• Miami, FL: Buying a home can save you $314 per month.
• Memphis, TN: You’ll save $300 each month if you own rather than rent.
• Cleveland, OH: Buyers save $265 per month.
• Detroit, MI: Homeownership can help you save $213.
• Tampa, FL: Residents save around $191 each month.
• Oklahoma City, OK: You can save $188 by buying instead of renting.
• Houston, TX: Homeowners save $182 monthly in Houston.
• Birmingham, AL: You’ll pocket $153 per month with a mortgage.

For those of you in Louisville, KY, the savings may be a bit smaller, but they are still significant. By owning a home in Louisville, you can save $89 each month compared to renting. While the savings aren’t as large as some of the bigger metro areas, they still make a strong case for homeownership, especially when you consider the long-term financial benefits.

Other Cities Where Buying Can Save You Money

Here are some additional cities where the study found that buying is more affordable than renting:

• Indianapolis, IN: You’ll save $152 per month.
• St. Louis, MO: Buying saves you $139 monthly.
• Cincinnati, OH: Homeowners in Cincinnati save $81 each month.
• Orlando, FL: You’ll save $81 monthly as a homeowner.
• New York, NY: Despite being a pricey market, homeowners can still save $72 compared to renting.
• Hartford, CT: Homebuyers can save $70 per month.
• San Antonio, TX: Monthly savings are $66 when owning instead of renting.
• Philadelphia, PA: Though a smaller savings of $24, it’s still more affordable to buy here.
• Virginia Beach, VA: Residents save about $10 per month.
• Buffalo, NY: While savings are modest at $8, homeownership still beats renting.

What This Means for You

If your city is on this list, it’s time to take a closer look at your housing options. For those in Louisville, while the immediate monthly savings might not be as eye-popping as in New Orleans or Chicago, you’re still looking at nearly $100 in monthly savings—and that adds up. Plus, homeownership comes with long-term benefits, including property appreciation, tax deductions, and building equity, making it a sound financial investment.

Even If Your City Isn’t Listed

If your city didn’t make the list, don’t fret! Real estate markets are dynamic, and there’s a good chance your area may join this group soon. It’s a good idea to set financial goals now and get prepared so you can take advantage of buying opportunities when the time is right.

A Market in Transition

According to Orphe Divounguy, Senior Economist at Zillow, now is an excellent time to evaluate your financial situation. "It’s a great time to see how your affordability has changed and if it makes more sense to buy than rent," Divounguy says. With the current mortgage interest rates and housing trends, homeownership is becoming more affordable in many U.S. metro areas, despite the economic shifts.

Is It Time for You to Buy?

For many, the idea of leaving behind renting for good is becoming more feasible. The data shows that in many U.S. metro areas, homeownership not only offers financial benefits but also provides long-term security and equity-building opportunities. If you're curious about how the math works out in your city, it might be the perfect time to connect and explore your options.

If you’re ready to discuss the numbers and explore whether buying makes more sense than renting in Louisville or any other city, let’s connect. We can run the calculations together and see how homeownership could benefit you in the short and long term.

Source:

• Data from Zillow’s September 2024 analysis comparing mortgage payments with rent across the top 50 U.S. metro areas, assuming a 20% down payment and a 30-year fixed mortgage at a 6.5% interest rate.