It is easily the question most asked by anyone moving into their first home or downsizing into retirement. Should I buy or should I rent?To get more housing news, you can visit shine news official website.
For nearly a decade the answer has been buy. The crash in home prices, combined with record-low mortgage rates made buying and owning a home both cheaper than renting one and a better investment.Fast-rising home prices and higher mortgage rates have shifted the calculation to rent. The monthly costs of buying and owning a home that you occupy are up 14 percent over the past year, more than three times the annual increase in rent rates nationally, according to realtor.com. Rents are up just 4 percent. The number of local housing markets where it is cheaper to rent than buy is growing by the day."Even setting aside big upfront expenses like a down payment, rising month-by-month costs are likely keeping many people from purchasing," said Danielle Hale, chief economist at realtor.com.
"Today only 41 percent of people live in a county where the median-income family can afford to buy a home at the median list price, and affordability declined significantly over the past year."Home prices fell dramatically after the financial crisis and the subprime mortgage crash. Millions of homes went into foreclosure and were sold off at bargain-basement prices. Home values finally bottomed out in 2012 and then began to take off. In the last three years,
the gains accelerated dramatically, and now homes in most of the nation are worth more than they were at the inflated peak of the housing boom in 2006.It's normal," said Richard Bernstein of Richard Bernstein Advisors on CNBC's "Squawk Box." "Housing is an early cycle sector. Interest rates are low, incomes start to grow, so in an early cycle environment you can buy, but in a later cycle, interest rates go up, home prices go up, it's harder to buy."The recent acceleration in home prices has been due to a supply imbalance in the market: too much demand and too little supply.
That has shifted the equation back to rent, even though rents have increased a lot in the last few years.According to July home and rent prices, buying a home was cheaper than renting in just 35 percent of the nation's counties. That is down sharply from 44 percent just one year ago.And it's not just cheaper to rent, it may also now be a better investment. Renting and reinvesting the savings from renting, on average,
will outperform owning and building home equity, in terms of wealth creation, according to new research from Florida Atlantic University and Florida International University faculty. That is the first time renting outperforms buying since 2010.In 16 of the 23 major metropolitan markets covered in the research, renting is a better investment than buying. These cities include Atlanta, Dallas, Denver, Houston, Los Angeles, Miami, San Francisco and Seattle. It is still, however, better to buy than rent in much of the Midwest and Northeast, with Chicago and Cleveland showing the best ownership scores.

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