In Seattle, buying a home beats renting in less than two years
Home buyers in the Puget Sound region “break even” on a home purchase in 1.9 years.
The “Breakeven Horizon” study, published by Seattle online real estate company Zillow found that home buyers across the country break even on a home purchase in less than two years in 70 percent of housing markets.
Zillow credits the short time frame to low interest rates, rising home values and rising rent.
The average rent for an apartment in Seattle is $1,931 per month.
The study, featured in the paperback edition of “Zillow Talk: Rewriting the Rules of Real Estate,” defines the breakeven horizon as the number of years after which buying is more financially advantageous than renting.
The study notes that, nationally, those under 35 remain employed at the same place for about three years so buying may not make sense, even if paying a mortgage would be more affordable.
One prominent analyst — Matthew Gardner, chief economist of Seattle-based Windermere Real Estate — recently told the Business Journal that millennials in the Puget Sound region will begin to buy houses in 2016 because confidence in the housing market will grow. The median price of a King County home is now about $508,000.
Dallas has the shortest break even point, at 1.3 years. Washington, D.C., has the longest, at 4.5 years.
Rob Smith, Editor, Puget Sound Business Journal