It seems like ever since the wee ages of adulthood, someone has been in our ear saying “you need to stop renting and own something.” As someone with a father in real estate, I definitely know the importance of owning property. Have you ever heard of the price-to-rent ratio? The price-to-rent ratio measures the relative affordability of renting and buying in a given housing market. Homeowners and renters can use the ratio to decide which option makes more financial sense for their situation.
So you may be asking…how do you read the price-to-rent ratio? Well thanks to our friends at SmartAsset, they’ve done the work for us! A price-to-rent ratio between 1 and 15 indicates that buying is more favorable, a ratio between 16 and 20 indicates that renting is typically more favorable and a ratio of 21 or more indicates that renting is more favorable.
In this new study, SmartAsset calculated the price-to-rent ratio in the 50 most populous U.S. cities using the local median home value and median annual rent. Charlotte ranks among the cities where renting is favorable to buying a home.
Check out the table below! Charlotte got a 16.67 which indicates that renting is typically more favorable.
You can read the full study here!