13 Cities Where Renting Is Cheaper Than Owning a Home

lights mother and daughter playing home tent
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Americans’ homeownership rate is 65.3%, according to the latest U.S. Census data. Owning a home is a big part of the American dream. With it comes with a sense of accomplishment, security and pride.

It also comes with responsibility for maintaining the home, paying property taxes, carrying insurance, paying utilities and keeping up with community commitments such as paying association fees. These costs add up quickly, so it’s important to weigh the advantages and disadvantages before you buy.

LendingTree, the online loan marketplace, recently compared rents with mortgage payments in the 50 largest U.S. metros and concluded “renting is cheaper than owning in each of the nation’s 50 largest metros” if you’re still paying off your mortgage.

Following are the metros where renting is cheaper by more than $700 a month, beginning with cities with a smaller advantage for renters.

13. Milwaukee

Milwaukee on Lake Michigan
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Median monthly gross rent: $885
Median monthly housing costs (for homes with a mortgage): $1,599
Renting saves: $714

Housing sales in metro Milwaukee were down 25.2% in May versus a year before, with a lack of homes for sale cited as a drag on the market. The average sale price of a home in the metro area rose 8.3% in April versus a year before, to $266,922, the Milwaukee Business Journal says.

Milwaukee’s $714 gap between the costs of renting and buying landed it the No. 13 spot on LendingTree’s list.

12. Seattle

Seattle, Washington
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Median monthly gross rent: $1,403
Median monthly housing costs (for homes with a mortgage): $2,154
Renting saves: $751

Prior to the COVID-19 outbreak in the U.S., home prices in the Seattle area were growing faster than in any other major American city except Phoenix, according to The Seattle Times. Prices rose 6.9% year over year there in March, compared with an average of 4.4% for the rest of the country.

So despite having a higher typical rent than in many of the other cities on this list, renting offers big savings over owning a home in the Emerald City.

11. Philadelphia

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Median monthly gross rent: $1,114
Median monthly housing costs (for homes with a mortgage): $1,869
Renting saves: $755

Both median rent and median home values rose in Philly for 2019, according to Curbed Philadelphia. However, the number of available homes declined, which may be part of the reason renting is so attractive here.

10. Sacramento, California

Adonis Villanueva / Shutterstock.com

Median monthly gross rent: $1,219
Median monthly housing costs (for homes with a mortgage): $1,988
Renting saves: $769

Renting is a clear winner in Sacramento. And yet, there’s room to grow if you’re interested in homeownership. The city is among Indeed.com’s 2019 list of the best cities for job seekers, ranking in the top 20.

Secure a good job and rent for a few years so you can save for that down payment.

9. Chicago

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Median monthly gross rent: $1,092
Median monthly housing costs (for homes with a mortgage): $1,861
Renting saves: $769

Prior to the coronavirus pandemic hitting the U.S., experts expected Chicago’s 2020 housing market to be relatively flat, with minor decreases in both home prices and sales. That would be a good result for renters, who are seeing strong savings over homeownership in the Windy City.

8. Hartford, Connecticut

The skyline of Hartford Connecticut, where median rents are relatively low
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Median monthly gross rent: $1,090
Median monthly housing costs (for homes with a mortgage): $1,947
Renting saves: $857

If you’re looking to relocate and save on housing costs, consider Hartford. It recently made Glassdoor’s list of the top 10 cities for a new job, based on hiring opportunity, cost of living and job satisfaction. The city boasts a median salary of $60,320.

7. San Diego

The skyline of San Diego, where median rent is well below median mortgage payments
Dancestrokes / Shutterstock.com

Median monthly gross rent: $1,569
Median monthly housing costs (for homes with a mortgage): $2,478
Renting saves: $909

In spite of pandemic-related job losses, San Diego home prices are on the rise, The San Diego Union-Tribute found in the latest data. In fact, they’re rising faster here than anywhere in California, making renting in San Diego look like a bargain.

6. Providence, Rhode Island

Providence, Rhode Island
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Median monthly gross rent: $945
Median monthly housing costs (for homes with a mortgage): $1,863
Renting saves: $918

You can spend the money you save by renting in Providence on the city’s legendary restaurant scene. Two of the city’s chefs were among 2020’s James Beard Award semifinalists.

5. Boston

Street at Boston neighborhood
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Median monthly gross rent: $1,404
Median monthly housing costs (for homes with a mortgage): $2,365
Renting saves: $961

Like Sacramento, Boston ranks high on Indeed.com’s Best Cities for Job Seekers report, coming in at No. 3.

More good news: The Boston housing market is one of the fastest recovering from the recent slump caused by the COVID-19 pandemic, trailing only Denver, according to Forbes.

4. Los Angeles

The streets of Los Angeles, where median rent is relatively low
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Median monthly gross rent: $1,463
Median monthly housing costs (for homes with a mortgage): $2,490
Renting saves: $1,027

Living among the stars doesn’t necessarily require you to match their income, especially if you’re renting.

Average asking rent in Los Angeles is down compared with this time in 2019, according to a report in Los Angeles Magazine, which blamed the economic crises related to the COVID-19 outbreak.

3. San Jose

The skyline of San Jose, which has a lower median rent than median mortgage payment
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Median monthly gross rent: $2,108
Median monthly housing costs (for homes with a mortgage): $3,198
Renting saves: $1,090

Renting in San Jose might not be cheap — the city has the highest median rent on this list — but it sure looks that way compared with the alternative of having a mortgage there.

On the bright side, the city tops Indeed.com’s 2019 list of the best cities for job seekers.

2. San Francisco

San Francisco neighborhood.
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Median monthly gross rent: $1,790
Median monthly housing costs (for homes with a mortgage): $2,953
Renting saves: $1,163

You may not be able to afford to buy a home in San Francisco, but the high rents here might be worth it if you get a great job.

Indeed.com’s latest Best Cities for Job Seekers report named the city one of the best metropolitan areas for job seekers, just behind its southern neighbor San Jose. Additionally, it’s one of the fastest-recovering housing markets in the COVID-19 era, according to Forbes.

1. New York City

Fourth of July party
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Median monthly gross rent: $1,391
Median monthly housing costs (for homes with a mortgage): $2,731
Renting saves: $1,340

The biggest savings to be found from renting versus buying a home are in none other than the Big Apple, where the cost of renting is about half the cost of homeownership.

What a difference a year makes: Last year, typical rent in NYC was only about $250 below the typical mortgage payment.

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