Recent news reports focus on rising rents in many cities along with falling vancancy rates all pointing to renewed market pressures to buy rather than rent. Coming after a few years of declining home ownership along with housing construction running at half the normal pace, this shouldn’t be a big surprise — people need housing and if its not being built or bought, the answer is renting. Reports include the LA Times on Orange county with rents up 13% in the last year to Crains New York saying that rising rents are driving apartment sales. Close to New York City in the Jersey suburbs arguments that now is a good time to buy are heard as well. Yahoo Finance reports a list of 100 cities where rising rents makes buying look attractive. Among the top ten places to buy rather than rent are three S&P/Case-Shiller cities where home prices are unusually weak, under the level of 12 years ago — Detroit, Cleveland and Atlanta.
The national picture can be seen in the chart where the pendulum has recently shifted to favor buying over renting after a long wait. Since this is based on the ten cities overall and since renting, like buying, always has a location-location-location element, the chart is more a sign to consider buying than an absolute statement. As Yahoo Finance notes, in some metro areas center city locations may favor renting while suburbs have shifted to favor buying.