Trulia: Buying is 34% Cheaper Than Renting in DC Area

by UrbanTurf Staff

Courtesy of Trulia Trends. To use the interactive map, click here.

Despite rising home prices, it is still cheaper to buy than to rent in the DC area (along with the 100 largest metros in the country), according to a report published today by Trulia.

Trulia determined that buying is 34 percent cheaper than renting in the region, up from 31 percent in favor of buying back in September. However, the real estate site predicts that this gap will likely narrow with rising interest rates and home prices:

Some markets might tip in favor of renting this year as prices continue to rise faster than rents and if – as most economists expect – mortgage rates rise, due both to the strengthening economy and Fed tapering.

Trulia sent UrbanTurf some DC-area specific stats, breaking down the region into the city proper and the surrounding counties from a rent versus buy perspective. Check out the data below.


Note: Negative numbers indicate that buying costs less than renting.

Now with rent-versus-buy analyses, there are always questions about methodology, so Trulia has laid out the step-by-step path they used to come up with rent-vs-buy determinations in metro areas around the country.

In short, Trulia’s team compared the average rent and for-sale prices of an identical set of properties in each city, and then considered the present and future monthly costs associated with buying and renting and factored in one-time costs like down payments and security deposits.

Trulia assumed that owners will have a 4.5 percent rate on a 30-year mortgage, put 20 percent down and will stay in their homes for seven years. However, they also created an interactive map to see how the numbers work with different assumptions. For example, if someone in the DC-area has a 4.7 percent interest rate on their mortgage, but plans on staying in their home for just five years, buying is 25 percent cheaper than renting. With plans to move after three years, the advantage of buying over renting drops off almost completely.

If you don’t agree with the assumptions, Trulia has unveiled their own rent-versus-buy calculator, so that users can play around with specific numbers.

The other thing that plays a huge role in this determination is home price appreciation and depreciation, which Trulia takes into account:

In our rent vs. buy calculations, we use a conservative annual home price assumption that ranges between 1.7% and 3.1%, depending on the metro. The reality, though, is that there’s a huge degree of uncertainty about what home prices will actually do, and the cost of buying relative to renting could turn out to be a lot higher or lower than with our conservative baseline appreciation assumption. To see how much uncertainty there is around what could happen to home prices, we calculated the annual home price appreciation for the best and worst seven-year periods over the past 20 years for each metro, using Federal Housing Finance Agency (FHFA) price data.

See other articles related to: trulia trends, trulia, rent vs. buy, rent vs buy

This article originally published at http://dc.urbanturf.com/articles/blog/trulia_buying_is_34_percent_cheaper_than_renting_in_dc_area/8170


  1. B Ford said at 3:52 pm on Wednesday February 26, 2014:

    I think about this often. My mortgage on a 2 bedroom condo is a little over $1K. I’m near major roadways and bus lines. There are VERY few 2 bedroom apartments in DC renting for that.

  1. RedinAlexandria said at 4:24 pm on Wednesday February 26, 2014:

    What about property taxes associated with owning? And the maintenance costs—like replacing windows, HVAC, roofs, etc.—that go along with owning?

  1. The Editors said at 4:29 pm on Wednesday February 26, 2014:

    Redin Alexandria,

    You’ll see in the link about Trulia’s methodology that we included in the 5th paragraph that they include monthly costs, like insurance, taxes, and maintenance for home ownership in their calculations.

    The Editors

  1. bobbylee said at 4:35 pm on Wednesday February 26, 2014:

    Or even costs associated with keeping the property in sellable shape such as painting and replacing the kitchens and baths every 20 years? These all add up to a lot of money that most buyers don’t think about.

  1. Tommy said at 4:40 pm on Wednesday February 26, 2014:


      Remodeling every 20 years (which you are probably only going to do once) is MUCH cheaper than the sky-high rents you will be paying for a apartment every single month.  Not to mention those remodels are an investment that only make your property more valuable when you sell.  You don’t recoup any of the money you sink into rents.

  1. kob said at 4:45 pm on Wednesday February 26, 2014:


    All of that matters, kitchen replacements, etc. But look at it this way, if you are in a property for 20 years your cost are going to be way below rental by that point. You may have 10 years left on a mortgage and then you are free and clear, if not sooner.

    Fifteen years ago you could have bought a studio apt. in many DC neighborhoods with your credit card. They were that cheap. 

    In 20 years, the prices today may look very cheap in a decade or two.

    But if you rent, you can count on rental cost reflecting the market.

  1. Marc said at 4:48 pm on Wednesday February 26, 2014:

    I don’t know anyone who has been able to afford putting 20% down on a home - on a $500k property, that’s $100k! If we look at the FHA minimum downpayment (which I see far more often), you’re looking at a 3.5%, which has a big affect on your mortgage payment.

  1. SW, DC said at 5:16 pm on Wednesday February 26, 2014:

    wonder who thought it was cheaper to rent? this almost seems obvious…

    I’m surprised the DC market doesn’t demand more condos. All I see being built is apartments… Does no one want to stay in DC?

  1. LisaJDC said at 9:48 pm on Wednesday February 26, 2014:

    It’s not cheaper if you want to buy a condo. HOA dues are excessive, and when tacked onto a mortgage payment the cost is almost always more than renting.

  1. Colin said at 10:44 am on Thursday February 27, 2014:

    @Marc: My wife and I, ages 32 and 36, recently put down 40% on a 2BR, so people are doing it. I’ll add that I never made more than $50K until age 30, and I have never made more than $70K in a year.

  1. BTA said at 11:19 am on Thursday February 27, 2014:

    Isn’t the caveat that there are fixed costs to buying and selling so if you will probably move within say 5 years buying doesnt make sense?

  1. DomRep said at 11:48 am on Thursday February 27, 2014:

    @Marc - a lot of people are selling their first home and using the profits to put a huge chunk of it down on another home, hence the lower mortgage costs.

    @Lisa - As far as condo fees, I pay around $315 per month but that includes all utilities. Total mortgage after condo fees added in is about $1400 for a studio condo, which is probably cheaper than most studios in DC, and I live in the city. Some condos (and I looked believe me) would only include electric, water + rest is on the owner.

  1. Suze O. said at 5:50 pm on Thursday February 27, 2014:

    If you can’t afford to save up 20% for a down payment, then you can’t afford to own.  Keep renting.

  1. http://www.GetDCSold.com said at 7:53 pm on Sunday November 16, 2014:

    @Suze O-You have to save 20% for a down payment to buy a house. There are programs now where you can get a Conventional loan as low as 5%-10% down. And don’t forget you only need 3.5% down if you are use a FHA Loan.

Join the discussion

UrbanTurf now requires registration in order to post comments. Register here, or login below if you are already registered.

Click here if you forgot your password.

DC Real Estate Guides

Short guides to navigating the DC-area real estate market

We've collected all our helpful guides for buying, selling and renting in and around Washington, DC in one place. Visit guides.urbanturf.com or start browsing below!

Northern Virginia

Profiles of 14 neighborhoods across Northern Virginia

Looking to Give People A Reason to Stay Past 6pm
Happily Straddling the Line Between City and Suburb
Columbia Pike
Arlington’s Neglected Stepchild is Getting a Makeover
Crystal City
Turning Lemons into Lemonade
Lyon Village
Developing An Air of Exclusivity?
Hitting Its Growth Spurt
An Urban Village Hitting Its Stride
Del Ray
Virginia’s Small Town Near the Big City
Eisenhower Avenue
The Vibrancy Might Take a Few Years
The Quiet Neighborhood By the Beltway
Old Town
Mayberry By The Potomac
132 Commerical-Free Acres
Downtown Falls Church
Staying the Same in the Midst of Change
Tysons Corner
Radical Change Could Be On The Way

See more Northern Virginia »


Profiles of 14 neighborhoods in suburban Maryland

Small-Town Living in the State Capital
Bedroom Community Gets Buzzing Cache
Cabin John
In With The New While Maintaining the Old
Chevy Chase
Affluence, Green Lawns and Pricey Homes
Downtown Silver Spring
Experiencing a Resurgence After a Bumpy History
A Suburb on Steroids
Rockville Town Square
Despite the Dynamism, Still Somewhat Generic
Takoma Park
More Than a Little Bit Quirky
A Foodie Magnet on the Verge of Change
Capitol Heights
Kudzu, Front Porches and Crime
Glass Half Full or Half Empty?
Mount Rainier
Artists, Affordable Homes and A Silo Full of Corn
National Harbor
A Development Rises Next to the Potomac
Riverdale Park
A Town Looking For Its Identity

See more Maryland »

Northwest DC

30+ neighborhood profiles for the city's biggest quadrant

16th Street Heights
DC's Sleeper Neighborhood
Where (Almost) Everyone Knows Your Name
AU Park
One of DC’s Last Frontiers Before the Suburbs
DC’s Northern Neighborhood on the Cusp
DC’s 535 House Neighborhood
Cathedral Heights
Do You Know Where That Is?
Chevy Chase DC
Not to Be Confused With the Other Chevy Chase
Cleveland Park
Coming Back After A Rough Year
Columbia Heights
DC’s Most Diverse Neighborhood, But For How Long?
An Island of Serenity East of the Park
Dupont Circle
The Best of DC (For a Price)
Foggy Bottom & West End
Where the Institutional Meets the International
Forest Hills
Ambassadors and Adventurous Architecture
Fort Totten
Five Years Could Make a Big Difference
Foxhall Village
350 Homes Just West of Georgetown
Friendship Heights
A Shopping Mecca With a Few Places to Live
History, Hoyas and H&M
Glover Park
One of DC’s Preppier and More Family-Friendly Neighborhoods
A Posh View From Embassy Row
LeDroit Park
A Quiet Enclave in the Middle of the City
Logan Circle
Trendy Now, But Not By Accident
Mount Pleasant
Sought-After Homes Surround Main Street in Transition
Mount Vernon Triangle
From Seedy to Sought-After
The Long, Skinny Neighborhood at the City’s Northwest Edge
Park View
It’s Not Petworth
Penn Quarter/Chinatown
DC’s Go-Go-Go Neighborhood
Getting a Vibrancy of Its Own
The Duke’s Former Stomping Ground
Shepherd Park
DC’s Garden of Diversity
Spring Valley
A Suburb With a DC Zip Code
Not To Be Confused With Takoma Park
Not Quite Like Its Neighbors
U Street Corridor
The Difference a Decade Makes
Woodley Park
Deceptively Residential
Adams Morgan
No Longer DC’s Hippest Neighborhood, But Still Loved by Residents

See more Northwest DC »

Southwest DC

The little quadrant that could

Southwest Waterfront
A Neighborhood Where A Change Is Gonna Come

See more Southwest DC »

Northeast DC

Profiles of 10 neighborhoods in NE

New Development Could Shake Up Pastoral Peace
A Little Bit of Country Just Inside the District’s Borders
Not to Be Confused With Bloomingdale
H Street
A Place To Party, and To Settle Down
The Northeast Neighborhood That Few Know About
Michigan Park
A Newsletter-On-Your-Doorstep Community
Evolving from a Brand to a Neighborhood
Ripe for Investment Right About Now
The Difference 5 Years Makes
Big Houses, A Dusty Commercial Strip and Potential

See more Northeast DC »

Southeast DC

6 neighborhoods from Capitol Hill to East of the River

Capitol Riverfront
Still Growing
Hill East
Capitol Hill’s Lesser Known Neighbor
Congress Heights
Gradually Rising
Notable for Its Neighborliness
Historic Anacostia
Future Promise Breeds Cautious Optimism
Eastern Market
A More European Way of Living

See more Southeast DC »

Upcoming Seminars ▾