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Economic conditions may be driving more Americans to choose tenancy over the American dream of home ownership. Owning one’s home was at one time an ideal, when renters realized that for the same money, they could own a home. Real estate was thought of as a guaranteed investment. This perception has changed in terms of it not being a safe bet anymore. The theory that buying a home is cheaper than renting is being turned upside down. In some cities it is actually is cheaper to rent.

Renters have several advantages over buyers. Renters do not have to come up with huge down payments and closing costs to get into a home. They do not have to deal with hidden costs associated with buying a home, such as condominium association fees and annual upkeep. Closing costs are factored out. For renters, maintenance fees are included in each monthly outlay, which means there is no need to hire a plumber if the toilet overflows. Greater mobility is available to a renter, who is not strapped into a long term financial commitment in the property. The renter does not leverage the price of a property against the market conditions or be burdened with ongoing mortgage payments before being able to move into a new dwelling.

As reported in the Huffington Post, now may just be a better time to rent than buy in some cities according to calculations made by Trulia, an online real estate data provider using price-to-rent ratios to indicate whether it’s better to rent or buy a home in the 50 largest U.S. cities by population. By comparing the average purchase price of a 2-bedroom home — including mortgage fees and maintenance expenses — with the average rental price for 2 bedroom apartments, condos, and townhouses, Truilia came up with a way to gauge the local market for buyers versus renters. Trulia’s list of cities in which it is cheaper to rent than to buy are New York, Boston, San Francisco, San Diego, Portland, Kansas City (Missouri), Sacramento, Omaha, Fort Worth (Texas) and Seattle.

Green Street Advisors, a research firm specializing in real estate investment trusts, looked at a 19-year average ratio of monthly mortgage payments to monthly rent payments for the 50 largest markets. In 80% of markets, rents are more than 10% below their historical averages, and home prices are too high.

Whether home ownership is more advantageous than renting depends on a number of factors. Market conditions determine the price of a home, but personal needs also come into play. The most common questions to ask in weighing the question include local market conditions for rentals and homes; how long you intend to be in the area and your family status – are you married, getting married, have children or planning to have them; are you looking at it as an investment. In this downturn, job stability is likely the strongest factor in deciding whether to rent or buy.

Candi Sparks is the author of the “Can I Have Some Money?” books series.

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