Renters in South Florida should expect to pay 44.5% of their income to rent each month. Comparing this to homebuyers, renters are paying about 25% more of their monthly income than if they were a homeowner. Homeowners are estimated to spend about 20% of their monthly income towards their mortgages. Renting property in South Florida is currently 67.6% more expensive than the historical average after the housing crisis in 2008.
The national average spending on rent is about 30% of someone’s monthly income, whereas the national average spending on a mortgage is 15% of the average American’s monthly income.
Renting is usually more expensive than buying because the time-span associated with renting is typically shorter than purchasing a property. People normally start out their careers renting, but once they are able to afford to purchase either a property or a car, they jump right on it because of the costs associated with renting vs. buying.
Interest rates are at a historic low, but young Americans seem to still be hesitant on purchasing property. Factors that might contribute to this are the following: 1) Rent prices are slowing down. 2) Young adults are typically choosing to live in places where rent prices are stabilizing and property is expensive. They typically choose to live in big cities with large markets.
Young Adults are looking in cities like Texas, Honolulu, Austin, San Diego, and New York as potential places to purchase a home. Less than 30% of these homes are considered affordable for the typical average young adult in the United States. These are all cities where the average wages are considerably lower than the average monthly income it would take to pay a mortgage on a property.