A recent study has shown that in over half of the U.S. metros, when deciding whether to rent a home or buy a home, that buying a home is the better financial decision when the potential buyers would stay in the house at least two years.
In some areas the breakeven point between buying and renting is even sooner than two years. For example in Riverside the breakeven time is less than a year, Orlando is one year, Miami and Fort Lauderdale is a little over a year. While larger metro areas the break even point took longer than two years. For example Washington D.C. is a little over four years, Boston is four years, Phoenix, San Diego, Minneapolis and Baltimore are all just over 3 years.
The reason the breakeven point is catching up so quickly between renting and buying is because rent keeps rising while mortgage rates have remained very low. This is leaving many to ask themselves why should I renew my lease when I can reach the breakeven point in so little time and live in exact same area. Still some renters need to overcome major obstacles before they can even think about home-ownership. Many cannot qualify for a mortgage or cannot save up enough for a down payment, which leads them to renting because its more flexible and far less frustrating to many.