May 31, 2023 - Real Estate
It's cheaper to rent than own in the Twin Cities
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Renting is still cheaper than owning a home in most of the Twin Cities, according to an analysis by Redfin.
Details: The mortgage on a median-priced home in the Twin Cities costs $2,852 a month. That same home would cost $2,381 a month to rent, according to the analysis.
- Redfin's calculations are based on a 5% down payment and a 6.5% interest rate on a 30-year mortgage for a home purchased in March.
Yes, but: That doesn't necessarily mean that renting is a better financial decision. Homeowners build up equity, have stable monthly costs and enjoy tax benefits, Redfin notes.
Between the lines: Rents in the Twin Cities are rising much slower than the national average. Home prices were skyrocketing in 2020 and 2021, but have stagnated in recent months due to higher interest rates.