In the majority of U.S. counties, it is more affordable to own a home than rent one. This data comes from ATTOM Data Solutions’ 2021 Rental Affordability Report, which found that in 63% of the 915 counties analyzed it is easier to afford a median-priced three-bedroom home by owning rather than renting. ATTOM reviewed fair market rent data, wage data, and public record sales deed data to reach its conclusions. Fortune reports that buying remains more affordable although median home prices have continued to increase much more than rents, and even home prices are rising faster than wages. But in highly populated metropolitan areas, it is cheaper to rent.
Meanwhile, demand for homes—driven in part by stir-crazy city dwellers moving to the suburbs to seek more space amid the pandemic—continues to outpace supply. For the four weeks ending Jan. 10, according to the National Association of Realtors, the number of contracts signed was up 15% across the U.S. compared to a year ago and the number of active listings was down 34%.
Buyers in big cities face a different choice than their counterparts in rural or suburban areas, however. According to ATTOM's analysis, renting is now more affordable than buying in 18 of the 25 most populous counties in the U.S. The same is true in 29 of the 44 counties with a population of 1 million people are more. The list of cities where renting is a better deal than buying includes Boston, Chicago, Los Angeles, San Francisco, Seattle, and the boroughs of Manhattan and Brooklyn in New York City.