There are areas in the United States where it is cheaper to buy a house than to rent it. Phoenix is not one of them.
A report by real estate firm Roofstock pulled together figures from the US Census, HUD and Zillow to determine where in the US it was cheaper to get a mortgage on a median-priced home than to rent. Unsurprisingly, the major metros where renters should think about buying are primarily in the South, Mid-Atlantic, and Mid-West. In Pittsburgh, a mortgage on a home at the median price assuming a 20% decline and an interest rate of 5.33% costs about $933. Rental in the same area would cost $1,063. Rochester, Detroit, Oklahoma City and Memphis are the other top-rated metropolises where a mortgage can be cheaper than a rental.
Where does Arizona fit in? Roofstock found Yuma to be an area where mortgages were cheaper than rents. It was ranked 91 out of 257 ranked subways.
This does not mean that rents in Arizona are cheap. According to data from Zillow, Phoenix-area rents were under a thousand dollars in 2014, well below the median for the United States. In 2021, however, rental prices have soared, with Phoenix seeing a 28% increase, with median rents finally reaching around two thousand in July of this year.
All major markets in the southwest saw similar spikes. Rental in Phoenix and Las Vegas very trendy with each other. Tucson rose from $1,300 in early 2021 to around $1,650 and Los Angeles, still significantly higher, saw a 20% increase from around $2,400 to nearly $3,000.
The highest rents in Sun Valley are found primarily in the Northeast Valley. Cave Creek rents are close to Los Angeles at around $3,000. Scottsdale’s median rents are $2,400 while Fountain Hills and Gilbert were both around $2,300. The cheapest rents according to Zillow are in the big cities. Tempe, Glendale, Phoenix and Mesa all have median rental prices ranging from $1,800 to $1,900 per month.
When Zillow tracks rentals, it includes both single-family and multi-family dwellings. The measure used is the median price, which means that there will be approximately an equal number of rentals priced above and below the number.