Owning us property twice as affordable as renting

Photo credit: Cyndie

Research from Zillow reveals that, as of the third quarter of 2014, US rents spend approximately 30 per cent of their income on rent, compared to homeowners, who spent 15 per cent of their monthly salary on mortgage payments.

The balance is a significant shift from the market before the housing bubble, when rent was more affordable in major metros to renters than buyers. Today, though, thanks to low mortgage rates and fallen property prices, it is now cheaper to purchase then rent.

The same is true even the least affordable parts of the country, such as San Francisco or Los Angeles, with rents increasing due to demand from those unable to afford owning a home in the wake of the financial crisis.

"Despite rising home values, homeownership remains very accessible for buyers that can scrape together a down payment — even a relatively modest one — find a home to buy and secure financing," says Zillow Chief Economist Dr. Stan Humphries.

Humphries adds that he expects 2015 to be a breakthrough year for younger buyers entering the market.