Nationwide, renting is cheaper than buying a home — but not everywhere. According to a new report by Realtor.com, renting can save you an extra $1,000 per month compared with buying a home, but that’s not the case in three out of four cities in Ohio.
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Renting in Ohio
Ohio’s rental market is definitely heating up. According to data from Zillow, the median rent price for Ohio is $1,300, a $54 increase year-over-year, but prices in Columbus, Cleveland and Cincinnati are even higher.
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Zillow found that Cleveland had one of the fastest rent price hikes nationwide at 7.2%, following closely behind Hartford, Connecticut, at the top of the list. Cincinnati and Columbus also saw increases of 5.2% and 4.7%, respectively.
Skylar Olsen, Zillow’s chief economist, said this is because people typically move during the summer, which heats up the rental market. “Renters are being drawn to more affordable areas within the Northeast and Midwest,” Olsen said. Remote and hybrid work has made it possible for people to live further away from bigger cities like New York and Boston. “The savings seem worth it for many renters, even if it means an occasional painful commute,” Olsen added.
Buying a House in Ohio
Ohio is one of the country’s hottest (and most affordable) housing markets. In a Realtor.com rankings list, five out of 20 of the country’s top housing markets were in Ohio.
“As buyers contend with still-high home prices and mortgage rates across much of the country, affordable areas in the Midwest have gained popularity,” said Hannah Jones, senior economic research analyst at Realtor.com. “Buyers in these markets can take advantage of lower home prices without compromising on job prospects or lifestyle amenities.”
Renting vs. Buying Real Estate in Ohio
GOBankingRates conducted research to determine the difference in prices between renting and buying a home. Out of the four cities located in Ohio in the analysis, buying was a cheaper option in three of the cities.
Here’s a cost breakdown of renting versus owning real estate in Columbus, Cleveland, Cincinnati and Toledo.
Columbus
- Total population: 902,449
- Median household income: $62,994
- Average home value: $247,042
- Average monthly mortgage payment: $1,463
- Average monthly rent: $1,483
- Homeowner monthly cost of living: $3,368
- Renter monthly cost of living: $3,389
- Cheaper option: Buying
Buying a home is only slightly more affordable than renting in Columbus.
A separate Realtor.com report also revealed that Columbus ranked first for its low cost of living and low unemployment rate. The city also had the highest number of views per property. Additionally, there’s a greater share of interest coming from outside the region. Realtor.com stated that this suggests that Columbus has more appeal across the country, potentially becoming a more competitive space.
Cleveland
- Total population: 370,365
- Median household income: $37,271
- Average home value: $113,340
- Average monthly mortgage payment: $671
- Average monthly rent: $1,410
- Homeowner monthly cost of living: $2,498
- Renter monthly cost of living: $3,236
- Cheaper option: Buying
Buying a home is also cheaper than renting in Cleveland. According to U.S. News & World Report, Cleveland is one of the most undervalued markets in which to buy a home. The metro area has a payment-to-income ratio of 20.6%.
Cincinnati
- Total population: 308,870
- Median household income: $49,191
- Average home value: $246,753
- Average monthly mortgage payment: $1,461
- Average monthly rent: $1,446
- Homeowner monthly cost of living: $3,366
- Renter monthly cost of living: $3,351
- Cheaper option: Renting
Cincinnati is the only Ohio city on this list where it’s cheaper to rent than buy. It’s also one of the most popular cities among Generation Z, a SmartAsset analysis revealed. According to the analysis, 1.52% of local Gen Zers purchased a home in 2023.
Toledo
- Total population: 269,962
- Median household income: $45,405
- Average home value: $124,509
- Average monthly mortgage payment: $737
- Average monthly rent: $1,086
- Homeowner monthly cost of living: $2,553
- Renter monthly cost of living: $2,902
- Cheaper option: Buying
Realtor.com’s 2024 Top Housing Markets forecast placed Toledo on the list as one of the top markets predicted to break double-digit sales growth in 2024. The city is expected to have a 14.0% year-over-year increase in existing home sales, and it also has the highest share of homeowners who own their homes outright.
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This article originally appeared on GOBankingRates.com: Renting vs. Buying Real Estate: See the Cost Difference in These 4 Ohio Cities
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