How to decide when to rent and when to buy a home

Housing Market Trends - Zillow reports that 59% of renters intending to move within the next year plan to continue renting [1] - The average homeowner now takes 7 to 10 years for owning to make more financial sense than renting, considering mortgage interest rates, home value appreciation (expected to rise less than 2% year-over-year), rent price growth, and opportunity costs [2][3] - In expensive coastal metros like New York City and San Francisco, it can take 15 to 20 years to break even on buying, while in more affordable metros like Memphis or St Louis, it takes 3 to 4 years [4][6] - Prior to the pandemic, the buy-rent break-even point was 2 to 3 years nationwide [7] Renting vs Buying - Renting can be a smart long-term financial option, leading to the rise of the lifestyle renter who values flexibility and freedom [7][8] - The decision to rent or buy depends on personal lifestyle choices and how long one plans to stay in a place [8][9] Advice for Aspiring Homeowners - Improve credit, debt-to-income ratio, and savings to land a better interest rate [11] - Utilize tools like Zillow's Buiability to determine affordability on a monthly basis [12] - Form a team of experts, including a great agent and loan officer, to gain a competitive advantage [13] Future Outlook - Any cuts in mortgage rates or reduction in prices will help affordability and bring more buyers to the market, shrinking the buy-rent break-even time horizon [14] - Even if mortgage rates were to come down dramatically, only 37% of renters said they would buy a home, indicating a continued preference for renting due to lifestyle reasons [15]