According to Zillow, the median national rent was $1,416 in March. People paying those rates could afford the monthly expenses on a home that costs $289,500, which is well above a home at the national median value of $196,500.
Zillow’s analysis factors mortgage payments, property taxes, maintenance costs, and insurance payments into the monthly ownership fees. But, while homeownership may be less expensive than renting on a monthly basis, many renters struggle affording a downpayments.
Prices vary by market. In Detroit, Cleveland, and Milwaukee, it makes much more sense to buy than rent.
In these cities, a renter could afford a much higher-quality home than is typical in the market without increasing her monthly expenses. It’s also much easier to find available for-sale inventory at or below that value.