The monthly cost of buying a home is roughly 20% cheaper than renting in the majority of large markets.

Rents are up and buying that first starter home was cheaper in most large metro areas. With rental prices increasing, new data from Realtor.com suggests that renters who make the transition to first-time home buying could save on monthly payments.  In January, according to the Realtor.com monthly rental report, the cost of buying a starter home was more affordable than renting a similar sized unit in 26 of the 50 largest metro areas.  At that time, the median rental price increased by double-digits for the eighth straight month, up 19.8% year-over-year. The monthly cost of buying a home with up to two-bedrooms was up only 11% year-over-year.

"While both rental and homebuying costs are rising, a number of factors could tip the affordability scale in favor of first-time buying for many Americans this year. Rents are forecasted to outpace listing price growth in 2022 and are already accelerating across all unit sizes,” Realtor.com® Chief Economist Danielle Hale, said. More than half of the 50 largest U.S. metros favored buying in January and the gap between monthly starter home costs and rents in these areas was higher than last summer.  Across the 50 biggest U.S. metros in January the median listing price for a starter home was $295,360. In 26 of the 50 largest markets, the monthly cost of buying a starter home was an average of 20.6% lower than renting.

Source: Realtor.com