People moving to places such as San Jose and Los Angeles should just rent if they’re not planning to stay too long.
Zillow Porchlight found eight cities with breakeven points of three years or more. In San Jose, it takes 5.1 years or more for homeownership to make more financial sense than renting when factoring in not just monthly payments but also the down payment, fees, and closing costs.
San Francisco, Los Angeles, Washington D.C., and San Diego had breakeven points of four years or more. In Virginia Beach, Va., Hartford, Conn., and Phoenix, the breakeven points were more than three years.
Of course, renting in these areas isn’t exactly a bargain: In the San Jose metro, the median rent is $3,460 a month. San Francisco isn’t far behind, at $3,354 a month.
The national breakeven point is two years.
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