In Seattle, the decision between buying or renting comes down to the number 14.9. That’s how many years it would take for a buyer to break even, when it becomes cheaper than renting.
In Philadelphia, though, it only takes 2.9 years to break even, as the average monthly rent is $1,414 while the average mortgage payment is $432. In Seattle, rent may cost $1,777, and mortgage payments may be $1,751.
CNBC reports that SmartAsset determined the breakeven points for 11 major cities. The calculations factored in average rent and home prices for each market, along with a 4.5 percent mortgage rate, $2,000 in closing costs, and a 20 percent down payment. Results are based on a household earning $100,000 a year.
SmartAsset doesn't take differences in appreciation into account; depending on the neighborhood, you may find that your NYC apartment goes up in value quickly enough that you could sell after far fewer years than the site predicts.