According to the latest Census Bureau’s estimates (as reported by CNBC), it is now cheaper to rent than own in every state. The reasons for this are the usual suspects: maintenance, property taxes, repairs and insurance. The monthly costs associated with owning have increased by 15% as rent has increased by 4% nationwide.
The articles that I have recently read on this topic do not usually mention long-term appreciation but this is, at least in the short run, probably good news for millennial’s who have been facing rising interest rates, elevated housing prices and student debt. It could be good news to investors as well if the market cools off slowly versus suddenly, prices will stabilize, the FED will probably hold interest rates rather than raise them. At some point, the pent-up demand for home ownership will return.
CNBC has a state by state guide (https://www.cnbc.com/2019/02/13/how-much-more-money-it-costs-to-own-a-home-than-rent-in-every-us-state.html?forYou=true) which shows the median cost for home ownership with mortgage and the median rent. Below is a screen shot from the website which shows New Jersey, which has the largest disparity between rent and ownership costs.
