Buying a home remains a real bargain compared to renting in most areas nationwide, as the share of income typically needed to afford the average home is much lower today than it was in the past. But while buying a home is a great deal, for those current renters looking to buy — particularly millennials — saving up the necessary down payment can be a real challenge as rents keep rising.
Zillow’s July Real Estate Market Reports examined both mortgage affordability and rental affordability nationwide and in dozens of large markets. U.S. home buyers should currently expect to pay 15.3 percent of their incomes to a mortgage on the typical home, far less than the 22.1 percent share homeowners devoted to mortgages in the pre-bubble years between 1985 and 1999.
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