This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

5 Housing Markets Where You'll Break Even Fast When You Buy

BOSTON ( TheStreet) -- Buying a home seemed too risky to many Americans during the housing bust, but here's a look at five U.S. markets where prices have fallen so low you'd be crazy to rent.

"These are places where prices have in some cases fallen more than 50%," says Svenja Gudell, senior economist at market tracker Zillow.com (Z - Get Report). "They're forecast in many cases to rise really, really strongly because there's no place to go but up."

Zillow analyzed hundreds of housing markets recently to see how long buyers in each locale would need to "break even" -- pay the same in mortgage payments and other expenses (minus any capital gains) that they'd spend on rent.

Gudell says renting makes more sense than buying if you don't stay in a home long enough to reach the break-even point, but buying becomes the better deal thereafter.

Zillow found that break-even points range from one year in Memphis, Tenn.'s Shelby Forest-Frayser neighborhood to 20.3 years in Virginia Beach's upscale Sandbridge area. The average U.S. community has a 3.1-year break-even period.

Here's a look at places offering the shortest break-even points among America's 30 largest cities.

Zillow calculated break-evens by estimating each community's median home price, median rent, typical property taxes, expected future price appreciation and other factors. All figures are as of March 31 and refer to Zillow's estimates of prices and rents for all houses, condos and co-ops (including those not on the market) in each metro area.

1 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
Z $93.99 0.67%
AAPL $132.04 1.87%
FB $80.55 1.53%
GOOG $539.79 1.40%
TSLA $247.43 -0.01%

Markets

DOW 18,162.99 +121.45 0.67%
S&P 500 2,123.48 +19.28 0.92%
NASDAQ 5,106.5930 +73.8420 1.47%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs