Confirmed: It’s Cheaper to Buy in Philly!

There are folks who rent their homes that, for any of a variety of reasons, can’t swing the purchase of a house. Bad credit or suboptimal savings can make loan qualification nigh impossible. On the other hand, there are plenty of renters out there who justify their decision not to buy with the idea that owning is more expensive. This isn’t just a Philly thing – the “rent vs. buy” debate is one heated enough that just about everyone has an option.

The real estate pros at Trulia have a little more than opinions, though – they’ve done the math, and have facts. Namely, that buying trumps renting just about every time, including right here in Philadelphia. That’s news to some Philly residents, and we wanted to take a closer look at just how that math works out.

Renting vs. owning – a timeless debate with one right answer!

A lot went into coming up with the final numbers (a lot more math than I prefer to do, anyway!). Trulia took into account agent fees, closing costs, and other expenses involved in buying, as opposed to renters’ insurance and agent commissions – all this in addition to an actual rent or mortgage, obviously. But let’s not just trust the conjecture, instead, have a look at the numbers laid out and clearly showing an advantage:

By the numbers:

46% – How much cheaper it is to buy than to rent in Philadelphia, assuming you own a home for 7 years

$1,600 – Median Philadelphia rent

$175,000 – Median home selling price

$37,000 – Minimum take-home salary sufficient to buy a median-priced home

38% – How much cheaper it is to buy than to rent, nationally

10.6% – The mortgage APR at which renting would make more sense than buying

1989 – The last time mortgage rates went that high

If you are a Philly renter considering the move to home ownership, get in touch with Frank today!