Renting a starter home remains less expensive than buying in all 50 of the nation’s largest metropolitan areas, according to a new report from Realtor.com.
Across the 50 largest metros, the monthly cost of buying a starter home was $2,553 in July. The national rent advantage narrowed by $65 from one year ago, when buying cost $923 more per month than renting, compared to $858 today. Over that period, median rent declined $24, while starter-home buying costs fell $89, reflecting a $57 drop from lower typical listing prices and a $33 decrease from a lower mortgage rate.
The national median asking rent for 0-2 bedroom properties across the 50 largest metros was $1,695 in July, down $24 or 1.4% from one year before. This marked the 36th consecutive month of annual rent decreases. While the current level is $69, or 3.9%, below its August 2022 peak, the median rent across all unit sizes remains $225, or 15.3%, above the pre-pandemic July 2019 levels.
Last month, the median asking rent for two-bedroom units dropped 1.4% year-over-year, marking the 38th consecutive month of annual declines. At $1,893, the national median for two-bedroom units now sits $75 (-3.8%) below its July 2022 peak. Still, two-bedroom rents are 17.5% higher than in July 2019, while one-bedroom rents are 14.6% higher and studio rents are 13.7% higher.
“Renters have gained meaningful financial breathing room over the last three years, and that advantage is still real in many major metros,” said Jiayi Xu, senior economist at Realtor.com. “But the savings gap is no longer moving in just one direction. Starter-home prices are falling faster than rents in many places, giving households who are ready to buy a stronger reason to stay engaged with the market.”
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