Real Estate

2015 Update: Mortgage Monthly Payments Proving Cheaper Than Rent in DC (And Most Major Metro Areas)

Buying your first home can be a scary or mysterious process, especially in places like the DC area where housing prices just feel more expensive. “You’ve got a high cost of living just like any dynamic US city caused by a high cost of being ‘social’ and a ton of entertainment and lifestyle options that eat up disposable income in places like DC,” commented Gerard DiRuggiero, Principal Broker of UrbanLand Company. “It gives renters, whether you’re 25 or 40, the false perception that they cannot afford to own and invest in real estate here in the local area.”


Recent data highlighted by Zillow analyzed the 2nd Quarter of 2015 and found that the % of monthly income spent on mortgages in the DC area averaged 17.5% of the homeowner’s income. In the same data analysis, DC renters spent an average of 26.8% of their monthly income on rent. These are numbers for pure comparison only and do not include other costs or benefits of ownership such as property taxes, HOA/condo fees, maintenance or tax breaks.

There’s actually lots of options in DC in the 1BR and studio price points that are affordable

“This is a major departure from how the statistics looked locally in the stretch from 1985 to 2000. Renting here in DC used by be very inexpensive, with 16.8% of monthly income going to rent and 23.3% of income going to mortgage payments. As of now, these stats have completely flip-flopped, and buying/owning is significantly cheaper,” continued DiRuggiero.  “These are all concepts that we push in our popular First Time Home Buyer Workshops, and it’s encouraging to see formal research data validating what we learn from working with 5 to 15 new home buyers a week!”

Even better home buying values are up the road in Baltimore

How’s our neighbors doing? A bunch of cities are on the list, including Baltimore. In Baltimore, the situation for owners and home shoppers looks even better, with only 15.5% of income going to mortgages, while renters pay an average of 29.3% of their income to their landlord or management company. “Baltimore has been popping up a lot lately in the ULC Blog due to its growth as a renter investor market and magnet town for ‘millennials’,” said Gerard. “Their recent launch of the Maryland Grand Slam homebuying incentive program help eliminate Down Payment woes for Baltimore buyers. The landscape up in the city will change – this is a great time to get into that market before housing prices respond to new demand and begin to accelerate in Baltimore.

The full list of markets studied and their data from the Zillow study can be found in the

Renters in the DC area are making the move into ownership all over DC, and a large number of renters are finding success in our UrbanLand Company Workshops. “Buyers are taking advantage of low, low mortgage rates and the ability to buy with $0 Down, 3.5% Down or even 5% Down in the DC area. Some of our recent Workshop sales successes are below,” concluded Gerard.

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