Cities Where It’s Cheaper to Buy Than Rent

Note: This is the most recent release of our Cities Where It’s Cheaper to Buy Than Rent study. To see data from prior years, please visit the Full Results section below.

Price increases throughout the U.S. economy over the past few years have made nearly everything more expensive, but perhaps no spending category has squeezed Americans’ budgets like the cost of housing. Between high costs to buy a home and skyrocketing rents, non-homeowners are faced with impossible choices throughout the market.

Throughout 2020 and 2021, low interest rates and rising household savings and incomes positioned many Americans to buy real estate. But high competition and low supply created a boom in the residential real estate market that sent home prices in the U.S. to record highs. With home prices elevated and interest rates rising to cool the market, more would-be buyers have been priced out, increasing the competitiveness of the rental market and in turn driving rents upward.

These shifting conditions have made things difficult for households debating whether to buy or rent. Shelter is already the largest spending category for most U.S. households, but larger economic trends have raised the financial stakes on the buy-or-rent decision. For now, at least, renting has taken the edge.

The Cost of Buying vs. Renting Over Time

Amid high interest rates and home prices, the buying premium has skyrocketed

For years, the typical monthly cost of homeownership—after accounting for sale prices, mortgage rates, and property taxes—remained well below the cost of renting in the U.S. The aftermath of the Great Recession, combined with an extended period of low interest rates, kept mortgage payments affordable throughout much of the 2010s. Even as home prices surged in the competitive housing market of 2020 and 2021, historically low borrowing costs continued to make buying a home more financially attractive than renting.

However, by 2022, the equation shifted. A combination of soaring home prices and rapidly rising interest rates made renting the more affordable option in most markets. Mortgage rates have more than doubled since reaching record lows in January 2021, and while home price growth has slowed, the median home price remains approximately 33% higher over the same period. As of January 2025, the typical monthly mortgage payment (including property taxes) for a home in the U.S. is now 21% higher than the typical monthly rent.

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The Cost of Buying vs. Renting by City

Residents in California & Washington will pay the largest premium to buy

And within some geographic markets, buying is unquestionably more difficult. Locations that face low supply, competitive markets, and high home prices—like cities throughout California and in the greater Seattle, WA region—can be three or even close to four times more expensive for buyers. Fast-growing cities like Frisco, TX and Cary, NC are also proving especially challenging for buyers.

Out of the 343 U.S. cities considered in this analysis, only 32 are currently more affordable for buyers than renters. Most of these locations are found in Southern states like Alabama, Georgia, and Texas or in Rust Belt locations like Ohio and Michigan. In these locations, home costs remain relatively low, allowing buyers to save relative to the cost of renting.

Below is a complete breakdown of nearly 350 U.S. cities and 1,100 counties. The analysis was conducted by Construction Coverage using data from Zillow, the U.S. Census Bureau, and Freddie Mac. For more information, refer to the methodology section.

The Cheapest Cities for Homebuyers

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The Cheapest Counties for Homebuyers

*Premium/discount of buying vs. renting

Methodology

The data used in this study is from Zillow’s Home Value Index (ZHVI) and Observed Rent Index (ZORI), U.S. Census Bureau’s 2023 American Community Survey (ACS), and Freddie Mac’s Primary Mortgage Market Survey. To determine the relative cost of buying vs. renting by location, researchers calculated the percentage difference in the monthly mortgage payment and property taxes for a median price home compared to the monthly rent payment for a median price rental. The monthly mortgage payment reflects a 30-year mortgage with a 10% down payment at a 6.85% interest rate based on the current ZHVI as of January, 2025. Monthly property tax estimates were obtained using ACS data by dividing aggregate annual property taxes paid in each location by the aggregate value of all homes. The resulting percentage was multiplied by the median home price and divided by 12. Only locations with available data from all sources were included in the analysis. To improve relevance, cities were divided into groups based on population size: large (350,000+), midsize (150,000–349,999), and small (100,000–149,999).

References

1. Duca, J. and Murphy, A. Federal Reserve Bank of Dallas. (2021, December 28). Why House Prices Surged as the COVID-19 Pandemic Took Hold. Retrieved on March 24, 2025 from https://www.dallasfed.org/research/economics/2021/1228.
2. U.S. Census Bureau and the U.S. Department of Housing and Urban Development. (2025, January 27). Median Sales Price of Houses Sold for the United States [Data set]. Retrieved on March 24, 2025 from https://fred.stlouisfed.org/series/MSPUS.
3. U.S. Bureau of Labor Statistics (2025, March 12). Consumer Price Index for All Urban Consumers: Rent of Primary Residence in U.S. City Average [Data set]. Retrieved on March 24, 2025 from https://fred.stlouisfed.org/series/CUUR0000SEHA.
4. Zillow. (2025). Zillow Home Value Index [Data set]. Retrieved on March 24, 2025 from https://www.zillow.com/research/data/.
5. Zillow. (2025). Zillow Observed Rent Index [Data set]. Retrieved on March 24, 2025 from https://www.zillow.com/research/data/.
6. U.S. Census Bureau. (2025). American Community Survey 1-Year Estimates [Data set]. Retrieved on March 24, 2025 from https://www.census.gov/programs-surveys/acs.
7. Freddie Mac. (2025, March 20). Primary Mortgage Market Survey [Data set]. Retrieved on March 24, 2025 from https://www.freddiemac.com/pmms.

Full Results