Renting vs. buying: How housing costs compare across America
The cost of housing isn’t just limited to the price tag of your monthly rent or the cost of financing the purchase price of your home. On the rental side, the cost of utilities can add a consistent, considerable amount to your costs. For homeowners, mortgage costs are padded not only by utilities but homeowners’ insurance, property taxes and maintenance costs. These hidden costs can add up and change the dynamics of trade-offs between the flexibility of renting versus the security of owning your own home.
With this in mind, SmartAsset ranked 342 of the largest U.S. cities based on the median gross rental and housing costs residents face on a monthly basis—including add-ons like utilities, insurance, maintenance and taxes—to help people most accurately evaluate the ongoing costs of buying versus renting.
Key findings
It costs twice as much to be a homeowner than a renter in Newark, New Jersey. Homeowners face median monthly costs of $2,641, or 1.97 times as much as the median monthly costs of $1,341 for renters. The median home value for owner-occupied units here is $403,500—just slightly higher than the median across large cities.
Homeowners pay $1,564 more per month than renters in Oakland, California. This is the greatest dollar premium on homeownership studywide. Homeowners face particularly high costs in Oakland, with a median $3,502 in housing bills per month, compared to $1,938 for renters. Overall, Oakland ranks sixth studywide for homeownership costs as a percentage of rental costs.
Renters have the best advantage in Surprise, Arizona. Renters have the biggest advantage in Surprise, where renting offers a roughly 15% discount—or savings of $321 per month—compared to homeownership. Homeowners pay an average of $1,789, compared to $2,110 for renters.
It is cheaper to own your home rather than rent in 17 cities. Most of these cities are in Arizona (Surprise, San Tan Valley, Buckeye, Gilbert, Chandler, Tempe, and Goodyear); and Florida (Palm Bay, Riverview, Brandon, Lehigh Acres, Palm Coast, Port St. Lucie, Spring Hill, and Cape Coral). Other cities where homeowners pay less include South Fulton, Georgia, and North Charleston, South Carolina.
Renters and homeowners are at a dead tie in terms of costs in South Bend, Indiana. Rent and homeownership are both inexpensive in South Bend, both coming in at a median of $1,062 per month. The average home value here is $148,800.
Top 10 cities where homeownership is more expensive than renting
Newark, New Jersey
Housing cost ratio (Homeowner:Renter): 1.969
Difference in monthly costs for homeowners relative to renters: $1,300
Median monthly costs while renting: $1,341
Median monthly housing costs for homeowners: $2,641
Median home value: $403,500
Elizabeth, New Jersey
Housing cost ratio (Homeowner:Renter): 1.908
Difference in monthly costs for homeowners relative to renters: $1,372
Median monthly costs while renting: $1,511
Median monthly housing costs for homeowners: $2,883
Median home value: $468,200
New Orleans
Housing cost ratio (Homeowner:Renter): 1.898
Difference in monthly costs for homeowners relative to renters: $1,080
Median monthly costs while renting: $1,203
Median monthly housing costs for homeowners: $2,283
Median home value: $306,400
Yonkers, New York
Housing cost ratio (Homeowner:Renter): 1.826
Difference in monthly costs for homeowners relative to renters: $1,380
Median monthly costs while renting: $1,671
Median monthly housing costs for homeowners: $3,051
Median home value: $541,200
Los Angeles
Housing cost ratio (Homeowner:Renter): 1.810
Difference in monthly costs for homeowners relative to renters: $1,519
Median monthly costs while renting: $1,875
Median monthly housing costs for homeowners: $3,394
Median home value: $919,900
Oakland, California
Housing cost ratio (Homeowner:Renter): 1.807
Difference in monthly costs for homeowners relative to renters: $1,564
Median monthly costs while renting: $1,938
Median monthly housing costs for homeowners: $3,502
Median home value: $915,000
Fargo, North Dakota
Housing cost ratio (Homeowner:Renter): 1.786
Difference in monthly costs for homeowners relative to renters: $750
Median monthly costs while renting: $954
Median monthly housing costs for homeowners: $1,704
Median home value: $282,700
Metairie, Louisiana
Housing cost ratio (Homeowner:Renter): 1.783
Difference in monthly costs for homeowners relative to renters: $895
Median monthly costs while renting: $1,143
Median monthly housing costs for homeowners: $2,038
Median home value: $319,700
New York City
Housing cost ratio (Homeowner:Renter): 1.766
Difference in monthly costs for homeowners relative to renters: $1,339
Median monthly costs while renting: $1,748
Median monthly housing costs for homeowners: $3,087
Median home value: $743,000
East Los Angeles, California
Housing cost ratio (Homeowner:Renter): 1.759
Difference in monthly costs for homeowners relative to renters: $1,091
Median monthly costs while renting: $1,437
Median monthly housing costs for homeowners: $2,528
Median home value: $633,600
Top 10 cities where renting is more expensive than homeownership
Surprise, Arizona
Housing cost ratio (Homeowner:Renter): 0.848
Difference in monthly costs for homeowners relative to renters: -$321
Median monthly costs while renting: $2,110
Median monthly housing costs for homeowners: $1,789
Median home value: $443,500
San Tan Valley, Arizona
Housing cost ratio (Homeowner:Renter): 0.857
Difference in monthly costs for homeowners relative to renters: -$300
Median monthly costs while renting: $2,091
Median monthly housing costs for homeowners: $1,791
Median home value: $433,500
Palm Bay, Florida
Housing cost ratio (Homeowner:Renter): 0.890
Difference in monthly costs for homeowners relative to renters: -$190
Median monthly costs while renting: $1,722
Median monthly housing costs for homeowners: $1,532
Median home value: $300,600
Riverview, Florida
Housing cost ratio (Homeowner:Renter): 0.892
Difference in monthly costs for homeowners relative to renters: -$240
Median monthly costs while renting: $2,215
Median monthly housing costs for homeowners: $1,975
Median home value: $392,100
Brandon, Florida
Housing cost ratio (Homeowner:Renter): 0.903
Difference in monthly costs for homeowners relative to renters: -$184
Median monthly costs while renting: $1,890
Median monthly housing costs for homeowners: $1,706
Median home value: $360,200
Lehigh Acres, Florida
Housing cost ratio (Homeowner:Renter): 0.903
Difference in monthly costs for homeowners relative to renters: -$167
Median monthly costs while renting: $1,718
Median monthly housing costs for homeowners: $1,551
Median home value: $321,700
Buckeye, Arizona
Housing cost ratio (Homeowner:Renter): 0.925
Difference in monthly costs for homeowners relative to renters: -$145
Median monthly costs while renting: $1,930
Median monthly housing costs for homeowners: $1,785
Median home value: $426,000
Palm Coast, Florida
Housing cost ratio (Homeowner:Renter): 0.938
Difference in monthly costs for homeowners relative to renters: -$111
Median monthly costs while renting: $1,790
Median monthly housing costs for homeowners: $1,679
Median home value: $385,000
South Fulton, Georgia
Housing cost ratio (Homeowner:Renter): 0.948
Difference in monthly costs for homeowners relative to renters: -$94
Median monthly costs while renting: $1,815
Median monthly housing costs for homeowners: $1,721
Median home value: $334,100
Port St. Lucie, Florida
Housing cost ratio (Homeowner:Renter): 0.952
Difference in monthly costs for homeowners relative to renters: -$98
Median monthly costs while renting: $2,053
Median monthly housing costs for homeowners: $1,955
Median home value: $397,500
Data and methodology
To find the net difference in monthly costs for homeowners versus renters, SmartAsset compared the following variables from 342 cities with populations over 100,000 people for which data was available. All data comes from the U.S. Census Bureau’s 2023 American Community Survey.
Mortgage cost: The median monthly housing costs for owner-occupied housing units with a mortgage. This includes the cost of mortgage, insurance, taxes, common utilities, and any applicable condominium and mobile home fees.
Rent cost: The gross median monthly rent for occupied units paying rent. This includes the cost of rent plus average utility and fuel costs.
Cities were ranked on the relative difference between monthly costs for homeowners versus those for renters. The dollar value in difference as well as median home values was also observed.
This story was produced by SmartAsset and reviewed and distributed by Stacker.
