NEW YORK (TheStreet) -- Trying to decide whether to buy a home or rent one is a big decision. In two-thirds of country's major metro areas, buying a home makes more sense than renting, even if the homebuyer stays in the home for just two years.
That's because in many markets the time it takes for a buyer to "break even" on her investment vs. renting is less than two years, according to analysis of fourth-quarter data by online real estate listings site, Zillow (Z). Zillow's break-even analysis "looks at how long it takes to come out ahead on a home purchase versus renting the same home, [by] recouping the costs [associated with] buying, including taxes and maintenance."
In other words, after buying and living in a home for more years than indicated by the "breakeven horizon," as Zillow calls it, "homeowners begin to have more money and assets than they would have if they had rented the same home over that same time period," the company said.
To be sure, home-price appreciation slowed over the past year, making the length of time it takes to "break even" on a purchase longer in most metro areas, Zillow said.
Still, with mortgage rates still near historic lows, even if they have inched up in recent weeks from earlier in the year, buying a home is now more appealing than ever.
Zillow calculated median estimate home values for the geographic areas by including the value of all single-family residences, condominiums and cooperatives, regardless of whether they sold within a given period. The values are seasonally adjusted. It calculates a median monthly rental price for a given geographic area by including the value of all single-family residences, condominiums, cooperatives and apartments in Zillow's database, regardless of whether they are currently listed for rent.
Here are the top 10 markets where it makes more sense to buy a home than to rent. And when you're done be sure to check out the best areas to rent rather than buy.
Note: Breakeven time frames are based on fourth-quarter data; median home values, monthly rents and home price appreciation estimates are as of May 31, 2015.
Breakeven time frame: 1.6 years
Median home value: $124,000
Median monthly rent: $1,099
Pittsburgh is fifth best area to own a home, because homeowners will "break even" on their purchase in about 18 months, according to Zillow.
Pittsburgh, with population of 306,000, according to 2013 U.S. Census data, had a home-ownership rate of 48.8% for the five years through 2013, lower than the state of Pennsylvania's rate of 69.8%.
Its median household income for the five years through 2013 was $39,195, according to Census data.
Zillow forecasts homes in Pittsburgh to appreciate 1.6% over the next year.
Breakeven time frame: 1.5 years
Median home value: $150,900
Median monthly rent: $1,283
Tampa tied with Atlanta, Las Vegas, Houston and Riverside, Calif., as the third best area to own a home, because homeowners will "break even" on their purchase in 17 months, according to Zillow.
Tampa, with population of 353,000, according to 2013 U.S. Census data, had a home-ownership rate of 50.9% for the five years through 2013, lower than the state of Florida's rate of 67.1%.
Its median household income for the five years through 2013 was $43,242, according to Census data.
Zillow forecasts homes in Tampa to appreciate 2.5% over the next year.