Contemplating whether to buy or rent a house, now is the time to make that decision.
Realtor.com compared rental prices between January 2020 and January 2022, showing the rent has increased by 21% in major cities. In January this year, rent in Miami, Florida shot by 54.2% compared to last year. The US national median rental price increased 19.8% between January 2021 and 2022, signaling a worrying trend.
As people move back to the big cities to resume physical work and business, they are at an impasse whether to continue renting property or buy a starter home. The high rent prices are skyrocketing in every major city, and predictions show that they will continue to rise throughout the year. Just like in the United States, in London, renters are paying £62 more a month than they did before the outbreak of the pandemic. Zoopla, a real estate company, based in London, attributes the escalating rental prices to loosening international travel restrictions, enabling international employees and students to return to the cities.
Buying property is becoming more lucrative than renting, going with the recent trend in inflated prices. A report shows that in more than 50 big US cities, buying a starter home was less costly than renting. In one of the cities, Tampa, Florida, buying is 25.5% less than renting.
During the lockdown, rent prices and property buying costs declined as many people left the cities to work remotely in the countryside towns. While the post-pandemic growth and demand in the property market meant property and rent prices would increase, the margin by which these prices have risen was not anticipated. People may opt to buy rather than rent to cope with the exaggerated rent prices exacerbated by the increasing cost of living.