Trends Top 10 Cities to Buy vs Rent Read the Article Open Share Drawer Share this:Click to share on Twitter (Opens in new window)Click to share on Facebook (Opens in new window)Click to share on Tumblr (Opens in new window)Click to share on Pinterest (Opens in new window)Click to share on LinkedIn (Opens in new window) Written by Mint.com Published Jun 22, 2010 2 min read Advertising Disclosure The views expressed on this blog are those of the bloggers, and not necessarily those of Intuit. Third-party blogger may have received compensation for their time and services. Click here to read full disclosure on third-party bloggers. This blog does not provide legal, financial, accounting or tax advice. The content on this blog is "as is" and carries no warranties. Intuit does not warrant or guarantee the accuracy, reliability, and completeness of the content on this blog. After 20 days, comments are closed on posts. Intuit may, but has no obligation to, monitor comments. Comments that include profanity or abusive language will not be posted. Click here to read full Terms of Service. The real estate market continues to trundle along, now that the homebuyers tax credit has expired and with it, the rush to sign a contract and qualify for $8,000 of free money. On June 22, the National Association of Realtors announced that existing home sales completed in May were down 2.2% compared with April, confirming expectations that the housing recovery will slowed down once the government’s incentives expire. (There was some good news, though: compared with the same period in 2009, sales were up 19.2%.) That said, relatively low home prices throughout the country have caused many people to consider the issue of buying versus renting. In some areas, prices have declined so much compared to rents that buying a house may actually make more economic sense. In others, despite price declines, renting is still more economically viable. Real estate listing website Trulia.com recently released its new Buy vs Rent index, ranking the top 10 cities in the United States where buying makes most sense, as well as the top 10 cities where you should rent. How did they decide? With the help of the so-called buy/ rent ratio, which is basically the average price of a home in an area divided by the average rent charged per year. If the result is 15 or lower, that means homes in that area are priced so low that buying is cheaper than renting. If the buy/ rent ratio is 20 or higher, the case is stronger for being a renter. Ultimately, of course, the decision to buy or rent should be based on much more than plain numbers and statistics. Homeownership enables you to build equity over the long term, but comes with costs beyond a home’s purchase price (such as property taxes and maintenance, the broker commissions and other costs associated with selling that home) that require a committment of at least five or six years to be recouped. You build no equity by renting, on the other hand, but you have the freedom to move at a month’s notice. The debate could go on and on. In the infographic below, we give you the results of Trulia’s analysis, along with some interesting facts on buying versus renting, including the average net worth of home owners compared with that of renters in recent years, from the Federal Reserve Board. Previous Post The Financial Burden of the Penny Next Post The Sobering Reality of Entrepreneurship in the U.S. Written by Mint.com More from Mint.com Browse Related Articles Saving 101 Is Renting Textbooks Really Cheaper Than Buying? Minimalist Lifestyle Chapter 01: Renting vs. Buying a House Housing Finances Renting Vs. Buying Student Finances How To Save Money On College Textbooks Financial Planning In Graphics: How to Sell a Home Housing Finances Why Renting is Better Housing Finances Renting? 10 Cities Where You Get the Biggest Bang for Y… Minimalist Lifestyle Home Ownership vs Renting As A Minimalist Lifestyle Dec… Financial Planning Should You Buy a Home Right Now? Housing Finances Is it Better to Rent or Own Your Home?