This price-to-rent ratio helps assess whether it is more cost-effective to buy or rent a home in a given market. A high price-to-rent ratio suggests that buying a property is more expensive relative to renting, whereas a low ratio indicates that buying may be more favorable than renting.
- Price-to-Rent Ratio below 16: It's generally cheaper to buy a home than to rent.
- Price-to-Rent Ratio between 17 and 20: The cost of buying and renting is roughly comparable.
- Price-to-Rent Ratio above 21: It's generally cheaper to rent than to buy.
Note: The national Price/Rent Ratio is derived from our in-house research by individually dividing the median price of 1, 2, and 3 bedroom dwellings in each city by their respective median annual rent, with the final ratio representing the average of these calculations across all bedroom types.
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