What DeDe’s Reading:  ATTOM’s 2024 Rental Affordability Report

I read ATTOM’s Report as soon as it was published yesterday.  The 2024 Rental Affordability Report by ATTOM reveals that, despite challenges in the housing market, renting a three-bedroom home remains more affordable than owning in nearly 90% of local markets across the U.S. The report indicates that both renting and owning pose financial burdens for average workers, consuming over one-third of their wages in most county-level housing markets.

The gap between renting and owning persists, even as rents have grown faster than home prices over the past year. The analysis incorporates 2024 rental prices, 2023 home prices, and average wage figures. Despite rising home prices and mortgage rates, renting remains more affordable than owning, particularly in populous urban and suburban markets.

Changes in rents have outpaced home price trends in almost two-thirds of U.S. counties analyzed. Renting a three-bedroom home is most affordable in counties with populations of at least 1 million, where it consumes at least 10 percentage points less of average local wages than owning. Honolulu, Brooklyn, Oakland, San Jose, and Orange County are highlighted as having the widest affordability gaps favoring renting.

The report also indicates that renting three-bedroom homes is most affordable in the South and Midwest, with several markets requiring less than one-third of average local wages. However, some counties in the South and West, like Collier County (FL) and Santa Barbara County (CA), show less affordability for renting.

In terms of home ownership, the most affordable markets are in the South and Midwest, while the least affordable are in the West and Northeast. Major expenses on a median-priced single-family home consume over one-third of average local wages in 88% of the counties analyzed.

The report highlights the dynamics of median three-bedroom rents increasing more than wages in some markets, while wages are growing faster than rents in others. Notably, average weekly wages are rising faster than median home prices in 58% of the counties, reversing a pattern seen in 2023.

In summary, the 2024 Rental Affordability Report underscores the ongoing challenges for average workers in both renting and owning homes, with renting remaining a more affordable option in a majority of local markets. The analysis incorporates data from ATTOM’s comprehensive property database and emphasizes the complex interplay of factors influencing the housing market.  My Takeaway:  If homeownership is your goal, let’s work out a plan to make sure it works for you.  Homeowners, it sounds like it’s time to buy an investment property and be an awesome landlord!

Concise Market Snapshot

Here’s the concise market snapshot of the Valley of the Sun.  Reach out with any specific questions you have!