Top 10 cities where renters pay more than homeowners – and where they pay less

Mortgage and rental costs are shifting throughout the country, with some parts of the country paying astronomical rent costs and others facing steep monthly mortgage payments.

In certain cities in the Bay Area, for example, owning a home costs at least $2,000 more than renting, a Smart Asset study found. Homeowners in New Jersey also often pay more than twice as much as renters.

However, some renters in cities in Arizona and Florida often pay a few hundred dollars more for rent than on a mortgage.

If you’re looking to purchase a home in today’s market, you can explore your mortgage options by visiting Credible to compare rates and lenders in minutes.

71% OF AMERICANS WAITING ON INTEREST RATE CUTS BEFORE HUNTING FOR HOMES: SURVEY

Cities where homeowners pay more than renters

According to Smart Asset’s research, residents of the 10 cities below often pay more to own a home than rent.

Berkeley, California

An expensive city, Berkeley has expensive monthly rents, but that’s nothing compared to the cost of a mortgage. Monthly rents average just over $2,000, but monthly mortgage payments average $4,000.

San Francisco, California

Another expensive Bay Area city is San Francisco. Monthly rents average slightly higher than Berkeley at $2,308. Mortgage payments are just as high as Berkeley, at $4,000 per month. 

Oakland, California

California is home to many expensive markets, but it’s more expensive to own a home in most of the state’s cities. Rent costs in Oakland average under $2,000 at $1,838 while the average monthly mortgage payment is just about $3,400.

Elizabeth, New Jersey

The first New England city on the list is Elizabeth, New Jersey. Monthly rents average $1,391 in the city, but mortgage payments average $2,896.

Glendale, California

Just outside of Los Angeles is Glendale, another city where owning a home is going to cost homeowners. Homeowners pay an average of $3,512, but renters can save close to $1,500, averaging $2,009 in monthly payments.

Pasadena, California

In Pasadena, California, renters pay just under $2,000 on average each month, but homeowners pay closer to $3,500 for their monthly expenses.

Los Angeles, California

Unsurprisingly, it’s costly to be a homeowner in LA. A monthly mortgage payment averages $3,239 for many residents, but renters pay $1,788 per month, on average.

Sandy Springs, Georgia

Georgia is just one of the states in the South where homeowners pay more than renters. In Sandy Springs, the average monthly rent is $1,713, but the monthly mortgage payment is over $3,000 on average.

Seattle, Washington

Seattle is one of the most expensive cities in the Northwest, for renters and homeowners alike. Monthly rent averages $1,877 and monthly mortgage payments average $3,250.

New York, New York

In the Northeast, no state is quite as expensive as New York. NYC homeowners spend an average of $2,991 on mortgage payments while renters pay an average of $1,688 each month.

To see if you qualify for a mortgage based on your current credit score and salary, Credible can help you can compare multiple mortgage lenders at once.

AMERICANS TYPICALLY SPEND ABOUT 24% OF THEIR INCOME ON MORTGAGE PAYMENTS

Cities where renters pay more than homeowners

It pays to be a homeowner in certain states. Renting is especially expensive in Southern states like Arizona and Florida. Smart Asset’s study found that these cities were the costliest for renters.

Surprise, Arizona

In Surprise, Arizona, renters pay almost $400 more than homeowners. The median monthly gross rent is $2,064, but homeowners pay $1,696 on average. The average monthly mortgage comes in at just over $455,000.

San Tan Valley, Arizona

San Tan Valley, Arizona, renters pay $277 more on average than buyers. Mortgage payments average $1,566 while rents come in at $1,843 for an average apartment in the city.

Lehigh Acres, Florida

There’s not too much of a difference between renting and buying in Lehigh Acres. The average renter pays $1,598 in rent, but homeowners pay about $1,431 on average. Average home values in the city are just under $300,000.

Brandon, Florida

Brandon, Florida renters pay $155 more than renters on average. The average rent is $1,718 while homeowners pay $1,563 per month for an average home.

Gilbert, Arizona

There’s less than a $150 difference in renting vs. buying in Gilbert, but that adds up over the years. Renters pay a median monthly rent of $2,064 while homeowners pay a little less at $1,918.

Cape Coral, Florida

Cape Coral residents pay fairly similar amounts in rent compared to a mortgage, but there’s still a difference that favors homeowners. On average, the monthly housing cost for homeowners is $1,694 while renters pay $1,801.

Peoria, Arizona

Homeowners in Peoria, Arizona, have an average home price of $493,400 and an average mortgage payment of $1,785. There’s a $75 difference compared to the average renter who pays $1,860 to rent.

Meridian, Idaho

Idaho is relatively affordable compared to states with multiple major cities, but in Meridian, some renters still pay more than homeowners. Median monthly rents come in at $1,789 while mortgages come in a little lower at $1,739.

Spring Hill, Florida

Another city in Florida with slightly higher rents is Spring Hill. Renters pay $1,273 on average, while homeowners pay $1,253. Homes are relatively affordable, averaging $281,100.

Palm Bay, Florida

Palm Bay has the smallest difference between rent and mortgage payments on Smart Asset’s list at just $20. Renters pay $1,438 on average versus buyers who spend $1,420.

If you’re trying to find the right mortgage rate, visit Credible. You can use Credible’s free online tool to easily compare multiple lenders and see prequalified rates in just a few minutes.

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