Price-to-rent answers affordability questions If you’re debating whether to rent or buy, look to your local price-to-rent ratio for guidance.
Verify your new rate (Oct 29th, 2018) Where buying a home’s more affordable According to a new analysis from Rentberry, Trenton, New Jersey, boasts the nation’s lowest price-to-rent ratio, making it a slam-dunk for potential home buyers.
The median property price in Trenton sits at $149,700, while the average monthly rent is $1,500 per month, making Trenton’s rent-to-price ratio 8.
Daniela Andreevska, content director at real estate analytics firm Mash Visor, says anything in the 15 and under range means buying a home is more affordable than renting.
“For renters and homebuyers, this means that it is relatively cheaper to buy a property in a certain market rather than to rent there,” Andreevska said.
“So, if you have the necessary cash for a down payment and have figured out the rest of your financing in such a market, go ahead and buy a home.” Other cities with low price-to-rent ratios include Toledo, Dayton and Akron, Ohio; Syracuse, New York; Davenport, Iowa; Hartford, Connecticut, Cedar Rapids, Iowa; and Lansing, Michigan.
“In most of these locations, the median property price does not exceed $250,000, which is below the level in many other top markets at the moment,” Andreevska said.
Home prices in the area average $1.4 million, while the average monthly rent is $2,780.
“Some of these cities are infamous for the high real estate prices there, such as San Francisco, New York, El Paso, and Irvine,” Andreevska said.
In such expensive markets, it makes sense that renting is the better option or even the only affordable one.” Show Me Today's Rates (Oct 29th, 2018) Get today’s mortgage rates Looking to buy a home in one of the nations low price-to-rent markets?