•  A smart pig on a stack of books
  • Housing markets in the Midwest and East offer advantages to buyers


    Those waiting for the right time to pounce on residential properties and acquire mortgage loans might want to capitalize on the current market - especially those living in certain parts of the country. Realtor.com reported buying is much better than renting in 10 major cities in the Midwest, East or Southeast.

    Jonathan Smoke, chief economist at realtor.com, said Atlanta offered the best fiscal advantages for those looking to buy rather than rent [1].

    "Atlanta has always been more affordable, despite having seen very strong population growth for decades," Smoke said. "There's no natural barrier like an ocean or mountains or desert that limits development - so new construction has kept supply in balance with demand."

    Smoke added Atlanta's economy was hit harder than most major markets during the recession because the city is reliant on new construction and housing. He wasn't shocked to see Atlanta atop the realtor.com list, as the city's housing market only began a substantial recovery last year.

    Buying vs. renting
    The choice to buy or rent can be difficult for many Americans. Some people who plan to change jobs in the future prefer to rent to avoid being tied down to a particular place. Others who have job security might prefer to purchase a home rather than rent so they can begin to build up equity in the property.

    The New York Times reported buying is a smart option for those who plan to live in a particular residence for an extended period of time, but it's not as financially smart for those who plan to be nomadic and hop from one place to the next [2]. If a homeowner is considering buying a home that costs $500,000 and living in it for seven years, the Times stated it might be better if he or she looks for a similar place - in size or location - if the rent is $1,956 per month or less.

    Mark Zandi, Moody Analytics' chief economist, told the newspaper renting is often a better option in coastal markets where property is severely overvalued compared to rentals. He said it's usually more attractive to rent than buy in regions like California where buying property is expensive, though prospective buyers should judge each property on a market-to-market basis.

    A few of the best markets where renters can take advantage of low rent include Los Alamos, New Mexico; Summit Park, Utah; Cedar Rapids, Iowa; Des Moines, Iowa; and Madison, Wisconsin, according to realtor.com. However, Smoke agreed that renting is not the smartest option if a person intends to live in a market for longer than the break-even amount of time.

    Another reason to buy versus rent is the power to do as one wishes, according to AdviceIQ [3]. As a homeowner, a person can paint the walls any color they like - or add a koi pond to the backyard if they so choose - but one can't can't dig up the backyard as a renter.

    The best markets to buy
    Chicago came in second to Atlanta as the best market to buy rather than rent, according to realtor.com. Philadelphia, Detroit and Tampa, Florida, all made the top five.

    "Our top markets for buying generally didn't see the kind of price appreciation in the [housing] boom that the true bubble markets saw - and many of them, such as Detroit, actually went through turbulent economic times," Smoke said.

    To calculate these findings, realtor.com looked at median home values, fair market rental data and median incomes. They also assumed homeownership costs would not surpass 28 percent of a buyer's income.

    St. Louis, Pittsburgh, Cincinnati, Indianapolis and Virginia Beach, Virginia, rounded out the top 10.

    [1]. Where Is Buying Much Better Than Renting? In the 10 Cities Our Data Team ID'd

    [2]. Rent or Buy? The Math Is Changing

    [3]. Is it better to buy a home or rent?

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