Buy or rent? In some Mass. counties it makes sense to do this, report says

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Home prices are growing faster than rents in more than 80 percent of the United States, according to a report ATTOM Data Solutions released Thursday, and economists are forecasting a roughly 6 percent increase in the cost to purchase a home in metro Boston. So is renting really the most economical choice in Massachusetts?

Not so fast, ATTOM says. The report compared the median rent vs. the cost of buying in 11 of Massachusetts’ 14 counties. The analysis incorporated recently released fair market rent data for 2021 from the US Department of Housing and Urban Development, wage data from the Bureau of Labor Statistics, and public record sales deed data from ATTOM in 915 US counties with sufficient home sales data. Here was the breakdown for those Massachusetts counties, comparing the median cost to buy a single-family home and the median rent for a three-bedroom apartment in 2021:

County 2021 rent 2020 vs. 2021 Rent % change Jan.-Nov. 2020 Home Sales Price 2019 vs. 2020 Home Price Appreciation Rising Faster Cheaper to Buy or Rent?
Barnstable $2,203 8.6% $405,000 6.2% Rents Rent
Berkshire $1,575 3.6% $219,000 8.4% Home prices Buy
Bristol $2,228 1.5% $292,000 0.7% Rents Buy
Essex $3,072 0.9% $389,000 2.9% Home prices Buy
Hampden $1,504 2.7% $210,000 7.7% Home prices Buy
Hampshire $1,504 2.7% $265,000 1% Rents Rent
Middlesex $3,072 0.9% $512,500 3.5% Home prices Rent
Norfolk $3,072 0.9% $475,000 2.2% Home prices Buy
Plymouth $3,072 0.9% $375,000 4.2% Home prices Buy
Suffolk $3,072 0.9% $625,000 5% Home prices Rent
Worcester $1,930 23.2% $270,000 2.7% Rents Buy

(Check out our running lists of the cost to rent in nearly two dozen Massachusetts cities and in every Boston neighborhood.)

“Home-prices are rising faster than rents and wages in a majority of the country. Yet, homeownership is still more affordable, as amazingly low mortgage rates that dropped below 3 percent are helping to keep the cost of rising home prices in check,“ said Todd Teta, chief product officer with ATTOM Data Solutions.

“It’s startling to see that kind of trend. But it shows how both the cost of renting has been relatively high compared to the cost of ownership and how declining interest rates are having a notable impact on the housing market and homeownership. The coming year is totally uncertain, amid so many questions connected to the coronavirus pandemic and the broader economy. But right now, owning a home still appears to be a financially sound choice for those who can afford it.”

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