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Renting vs. buying for college: How the costs compare over 4 years
Lower found buying beats renting over four years in 41 of 48 college markets once modeled equity is counted.
- Real estate platform Lower found that while renting is cheaper monthly in 89.6% of college housing markets, buying a home offers a lower four-year net cost in 41 of 48 markets analyzed.
- Lower modeled these costs over four years using a 5% down Federal Housing Administration loan with a 7.03% mortgage rate, attributing 80% of built equity to a 4% annual home value appreciation assumption.
- Clemson, South Carolina, tops the list with an estimated four-year buying advantage of $87,503, followed by Santa Cruz, California, at $83,423, Riverside, California, at $77,509, and Philadelphia, Pennsylvania, at $76,337.
- In seven markets, renting remains the better financial choice, led by Iowa City, Iowa, with a $30,674 four-year advantage, and Austin, Texas, with a $13,798 advantage over the same period.
- The 4% annual appreciation rate is a standardized modeling assumption rather than a forecast; if home values grow more slowly or decline, buying may appear less favorable than estimates suggest.
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43 Articles
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Renting vs. buying for college: How the costs compare over 4 years
Lower reports that renting generally costs less monthly for college housing, but buying a home may save money over four years when equity is considered.
·Washington, United States
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Total News Sources43
Leaning Left3Leaning Right0Center39Last UpdatedBias Distribution93% Center
Bias Distribution
- 93% of the sources are Center
93% Center
C 93%
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