Renting vs. owning, which is less? According to a new study by LendingTree, U.S. homeowners with a mortgage pay 36.9% more a month than renters.
While down payments are a significant hurdle for consumers, LendingTree said that isn’t where the costs end.
LendingTree is an online marketplace that connects consumers with a network of lenders to compare offers for various financial products such as mortgages, personal loans, auto loans, and credit cards. Rather than being a direct lender itself, LendingTree allows borrowers to shop for the best rates and terms by having lenders compete for their business.
The LendingTree study showed that the median monthly gross rent was $1,487 in 2024, versus $2,035 for median monthly housing costs on homes with a mortgage. That is a monthly gap of $548, or $6,576 annually, and that monthly gap is $50 more than it was in 2023, when the difference was $498, LendingTree said.
Where are Gaps the Largest?
LendingTree’s study took a closer look at where those gaps are largest.
The study revealed that among the 100 largest metros, San Francisco has the largest cost difference between renting and owning with a mortgage. The gap om the Bay Area city is $1,565. Bridgeport, Connecticut at $1,427, and New York City at $1,409 follow.
Renting is cheaper than owning a home with a mortgage in every large metro, LendingTree said. Even in the metro areas where the differences are smallest — Phoenix, Orlando, and Columbia, South Carolina, — renters pay $184, $257 and $271 less a month, respectively, than those who have a mortgage.
LendingTree said the percentage gap in costs between renters and homeowners with a mortgage is widest in New York, Bridgeport and Providence, Rhode Island. Those gaps are 76.1%, 75.3% and 66.5%, respectively.
The study said that in 22 of the 100 largest metros, homeowners with a mortgage pay at least 50% more a month than renters.
Expert: The Choice Isn’t Just About Money’
Over the past five years, LendingTree said the monthly gap between renting and owning with a mortgage was highest in 2024 at $548 a month and lowest in 2022 at $475. From 2023 to 2024, median rent rose 5.8%, while homeownership costs with a mortgage increased 6.9%, the study said.
Matt Schulz, LendingTree chief consumer finance analyst and author of “Ask Questions, Save Money, Make More: How to Take Control of Your Financial Life,” said there is no universal answer to whether it’s better to rent or own.
“The choice isn’t just about money,” he said. “Homebuying can represent accomplishment, security, safety and plenty of other things. There’s a reason why homeownership has long been considered part of the American Dream. That said, owning can make financial sense depending on your goals.”
Traditionally, homeownership has been one of the best ways for people to build wealth. While the math on that has certainly been complicated by high housing prices and interest rates, it can still serve that purpose, LendingTree said.
“Also, the equity you can build in a home you own can provide valuable financing options in the future for things like a home remodel, starting a business or knocking down high-interest debt,” Schulz said. “To reap all of these benefits, you likely need to stay in the home for more than a few years. But it can pay off if that’s your plan.”
By metro area, San Francisco has the largest cost difference between renting and owning with a mortgage, LendingTree said. While the median rent is $2,435, the median housing costs are $4,000-plus. That’s a gap of $1,565.
Bridgeport, Connecticut at $1,427, ranks second, with renters paying $1,895 a month and homeowners with mortgages paying $3,322. New York City ($1,409) rounds out the top three, with a median rent of $1,851 and median housing costs of $3,260.
Delaying Home Buying
With those high cost differences in mind, Schulz said there’s no question that people are delaying buying homes because of high mortgage rates and prices.
“People are waiting longer to buy their first home,” he said. “They’re choosing not to buy a new home because they’re reluctant to trade their current low-rate mortgage for one at today’s higher rates. Some people are even becoming resigned to the fact that they’ll never be able to own a home. That sort of decision has massive ramifications, not just for individuals but for the economy as a whole. Unfortunately, however, that doesn’t seem likely to change anytime soon.”
Overall, LendingTree said that renting is cheaper than owning a home with a mortgage in every metro analyzed.
Phoenix, Arizona, it said has the smallest cost gap — renters there pay $1,819 a month, while homeowners with mortgages pay $2,003. That’s a difference of $184.
The LendingTree study supports recent research from InvestorsObserver that showed that between 2021 and 2025, 39 major metro areas across the country – spanning both red and blue states – flipped from being places where buying a home was cheaper than renting, to where renting is now the more affordable option.
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