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SmartAsset analyzed the 50 largest U.S. cities to identify the ones where homeownership is more affordable than renting. While renting offers flexibility and convenience, homeownership begins equity and can offer lower taxes. In some cities, markets are more favorable to homeowners, such as Midwest cities. SmartAsset ranked each market by price-to-rent ratio by comparing the median home value to the median annual rent. A lower ratio means renting is favorable. The largest cities, such as San Francisco, New York, and San Jose, are best for renters while Detroit, Memphis, and Milwaukee are top markets for homebuying.

Key Findings

  • The largest U.S. cities are good for renters. San Francisco, New York, San Jose, Seattle and Los Angeles are all in the top 10 of this study, and are all among the most populous cities in the country. Furthermore, the national price-to-rent ratio is 18.27, meaning that the market is still generally favorable to renters. Medium-sized cities like Memphis, El Paso and Baltimore, on the other hand, are better for buyers.
  • Renter-friendly cities populate California, while the Midwest is better for buyers. Of the 10 cities in our study where buying is more favorable than renting, five are in the Midwest. The median home value across these five cities, on average, is about $137,900.

1. San Francisco, CA

San Francisco, California is the first of three Bay Area cities in the top five of this study. The median home value is $1,217,500 (the most expensive on this list) and the median annual rent is $23,508 (second-highest after San Jose), putting the price-to-rent ratio at 51.79 (the highest in this study).

2. Oakland, CA

Across the bay, Oakland, California has the third-highest median home value ($807,600) and the seventh-highest median annual rent ($19,200). This puts the price-to-rent ratio at 42.06.

3. New York, NY

The Big Apple has the ninth-highest median annual rent ($17,796) and the sixth-highest median home value ($680,800). The price-to-rent ratio is 38.26.

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