Is Renting Still Cheaper Than Buying in 2025?

With housing affordability stretched and mortgage rates still higher than pre-2020 levels, many would-be buyers are wondering: Should I keep renting, or is it finally time to buy?

According to Bob Schildt, a trusted loan officer with years of experience guiding homebuyers, the answer isn’t just about the monthly payment—it’s about the long-term impact.

"Yes, in many cities, rent is still cheaper per month than buying a starter home," Schildt explains. "But that doesn’t mean it’s the smarter financial move."

The Monthly Cost Gap

Recent data shows that in some major markets, the average monthly rent can be up to $900 less than a mortgage payment on a comparable home. At first glance, that seems like a strong argument for renting.

But as Bob Schildt points out on BobSchildt.com, "Rent is 100% interest. You don’t get equity, you don’t get tax benefits, and you don’t build any long-term value."

What Buying Offers That Renting Doesn’t

When you buy, you start building ownership and financial stability with every payment. Over time, part of your payment goes toward paying down the principal—which means you’re investing in your future.

"Buying a home is like forced savings," Schildt explains. "Even if your mortgage is higher right now, you’re building wealth that renting simply can’t offer."

In addition, homeowners may benefit from:

• Fixed housing costs that don’t rise with inflation

• Mortgage interest tax deductions (depending on your situation)

• Long-term appreciation in home value

What About Mortgage Rates in 2025?

Many buyers are hesitant to purchase with current rates. But that rate doesn’t have to be permanent.

"You can refinance when rates drop," says Schildt. "But your rent? That’s almost guaranteed to keep going up."

The flexibility to refinance gives buyers a long-term advantage, especially when locking in a home before prices climb further.

Look Beyond the Monthly Payment

The key, according to Schildt, is to think about where you want to be in five years—not just next month.

"If you can afford the monthly payment now, buying puts you on a wealth-building path that renting never will. It’s not just about what’s cheaper today, but what gets you ahead tomorrow."

Want to Run the Numbers?

If you’re unsure whether buying makes sense for your situation, Bob Schildt is here to help. As he shares on his website, a personalized mortgage analysis can show you exactly what’s possible based on your income, goals, and market.

Sources:
Realtor.com, RentCafe.com, Zillow.com, NAR.realtor