Should You Buy or Rent? Here’s How to Decide
Choosing whether to buy a home or rent isn’t just about how much it costs right now. It’s about where you see yourself in the future, how stable your finances are, and what kind of lifestyle you want.
A recent report from ATTOM looked at home prices, rental costs, and wages across the U.S. It found that in most places, owning a home takes up less of a person’s income than renting a similar-sized place. But does that mean buying is always the best choice? Not necessarily.
In this guide, we’ll look at what the data says, when it makes sense to buy, when renting is smarter, and what to think about before making your decision.
What the Numbers Show
Every year, ATTOM studies how affordable it is to buy or rent in hundreds of counties across the country. The 2025 report highlights three key points:
Buying a home is cheaper than renting a 3-bedroom in nearly 60% of the U.S. Monthly homeownership costs—like mortgage payments, insurance, and property taxes—take up a smaller portion of wages than renting a similar home.
Housing is still expensive either way. Whether you rent or buy, housing takes up 25-60% of the average worker’s income. So while buying might be more affordable in some areas, it’s still a major expense.
Upfront costs are a big challenge for buyers. Even though monthly homeownership costs are often lower than rent, buying a home requires a big down payment and closing costs, which can be a financial hurdle.
When Buying a Home Makes Sense
Even though home prices keep rising, ATTOM’s data shows that in most areas, owning a home costs less per month than renting a three-bedroom. That’s because rent prices are climbing too, making it harder for renters to save money.
So when should you consider buying?
1. You Plan to Stay for a While
Buying a home is a long-term commitment. If you sell too soon, you might lose money on closing costs and other fees. If you plan to stay in the same place for at least five years, you’ll have more time to build equity and make the purchase worth it.
2. You Can Afford the Upfront Costs
The biggest challenge of homeownership isn’t always the monthly payments—it’s the down payment and closing costs. If you have enough saved to cover these without draining your emergency fund, buying could be a smart move.
3. You Want to Build Wealth Over Time
When you rent, your monthly payments go to your landlord. But when you own a home, your mortgage payments help build equity—meaning you gain ownership in the property. Over time, that can become a valuable financial asset.
4. You Need More Space
If you’re outgrowing your current rental, buying might be a good option. ATTOM’s data shows that renting a three-bedroom home takes up more of a worker’s income than owning one in nearly 60% of U.S. markets.
However, if you’re comfortable in a smaller rental, renting could still be the cheaper option. A one- or two-bedroom apartment often costs less than the total expenses of homeownership, especially when you add in maintenance, insurance, and property taxes.
When Renting is the Better Choice
Even though owning a home might save money in the long run, renting still has its benefits—especially if you need flexibility or financial security.
1. You Need Flexibility
If you’re not sure about your job situation, relationship status, or where you want to live long-term, renting gives you the freedom to move without the stress of selling a home.
2. You Don’t Have a Big Emergency Fund
Owning a home means paying for unexpected repairs, maintenance, and property taxes. If you don’t have at least three to six months of expenses saved, it might be safer to rent until you build up a financial cushion.
3. You Live in a High-Cost Area
In some cities, home prices are so high that buying requires a huge down payment and a big portion of your income. If a mortgage, property taxes, and insurance would stretch your budget too thin, renting may be the better option.
4. You Don’t Want to Handle Maintenance
When you own a home, you’re responsible for fixing things when they break. If you’d rather have a landlord take care of repairs, renting is the stress-free choice.
The Bottom Line: Should You Buy or Rent?
The best decision depends on your financial situation, lifestyle, and long-term goals:
Buy a home if you want stability, can afford the upfront costs, and plan to stay in one place for several years.
Rent if you need flexibility, aren’t ready for homeownership expenses, or live in an area where buying is too expensive.
No matter what you choose, making an informed decision will help you feel confident about your next move.