NEW YORK ( MainStreet) — Chew on this: in much of the country, it is cheaper to own than to rent. Read that again. A RealtyTrac survey of some 473 U.S. counties found that in 68% it is cheaper to buy than to rent. But there is a big exception. In many of the counties that are most attractive to Millennials, renting is significantly cheaper. That makes sense, because, so far, Millennials are shaping up as renters, and they are delaying home purchases.
Per RealtyTrac numbers, in the 25 counties with the biggest jump in Millennial population in the period 2007 to 2013, fair market rental rates for a three bedroom dwelling average 30% of household income. Buying in those markets requires 36% of household income. In some markets, the spreads are even greater. Renting in Hudson County, N.J. – directly across from Manhattan, in Hoboken, Jersey City, Weehawken, etc. – runs around 33% of median household income. Buying takes a much bigger bite, around 47% of income to purchase a median priced home. Hudson County, by the way, ranks sixth in RealtyTrac’s tally of the places with the biggest influx of Millennials. Millennial population there grew by 35.67% in the 2007 to 2013 period.
Where else exactly are Millennials flocking? And where are they fleeing? Note: it is not cheap just about anywhere. RealtyTrac analysis pegs the average fair market rent in the top 25 counties for Millennials at $1,459. That’s 19% above the national average. But some towns that draw Millennials are dramatically more affordable than many others.