Exploring Housing Affordability: Where Mortgage Payments Are Cheaper Than Rent Across the U.S.

It's no secret that housing prices have surged substantially across much of the country over the past five years. At the same time, rental rates have also climbed, transforming renting from a cost-saving step toward homeownership into a financial necessity for many households, making it increasingly difficult to save for a down payment. In fact, according to the 2025 Profile of Home Buyers and Sellers, 49% of first-time buyers who found saving for a down payment to be the most difficult part of the home buying process said that high rent made it harder to save.

To better understand where homeownership may still be attainable, we wanted to identify areas where monthly mortgage payments are lower than rent. We analyzed 215 Metropolitan Statistical Areas (MSAs), calculating median monthly mortgage payments and comparing them to fair market rents determined by the U.S. Department of Housing and Urban Development (HUD). Fair market rent reflects the cost of a moderately priced rental unit within a specific area and is based on data from the most recent American Community Survey (ACS). While three-bedroom homes are the most popular to buy, our analysis focused on that property type.

Notably, most of the areas where buying is more affordable than renting are in the Midwest and South, regions that have historically maintained lower home prices.

In contrast, areas where renting is more affordable are often found along the coasts and in other high-demand markets.

These findings highlight the growing disparity between rental and home ownership costs in many parts of the country. In areas where mortgage payments are lower than rent, potential first-time home buyers may find homeownership a more viable option, provided they can save enough for a down payment. However, in these regions, where rent is more expensive than a mortgage payment, achieving this savings goal may prove to be difficult.

Conversely, in high-cost areas where renting is comparatively less expensive than homeownership, housing affordability challenges continue to keep homeownership farther out of reach.

While the path to homeownership has become increasingly difficult nationwide, opportunities still exist in many areas of the Midwest and South. This highlights the challenges faced by first-time home buyers, who are struggling to save for a down payment amid rising rents. Identifying where homeownership remains within reach is essential for developing solutions that can expand access to homeownership, allowing more people to start building wealth.