Renting doesn't make financial sense in Pittsburgh (to rent, houses)

[jimmyev]

I think I agree with this from CNN-money on the two cities I know best:

Rent or buy? 10 cities rated - Pittsburgh --- BUY (4) - CNNMoney

[Katarina Witt]

Like all "fluff" articles, this one doesn't take into account all the variables that go into making the "buy v rent" decision. One of the biggest advantages of renting is that you don't have to try to sell a house when you relocate. Another advantage is that should your financial situation change for the worse, you can usually find a cheaper place fairly quickly. I also think someone new to the area is wise to rent for a while, to learn which parts of town they like, before buying.

[Bong477]

Renting in Pittsburgh doesn't make much sense over the long run. Over the short term it makes a lot of sense.

Also realise if you just compare home price to comparable rent price (as I think this list does), it can be a little misleading due vast differences in property taxes. You need to consider relative differences in the entire cost of ownership for these comparisons to be meaningful.

[gg]

That is a poorly written article that leaves out tons of stuff.

[PeterRabbit]

"Historical average gain: 3.91%"

Way back in history maybe but not more recently. Your property tax percentage could be that high. No maintenance with an apt. When taxes go up you might pay a percentage but not the entire bill. Houses are a lot of work and probably better for younger people or oldsters with money.

[BrianTH]

They used an eight-year breakeven point, and I'd guess that is true for most people--assuming you can stay in the place for at least eight years, buying will likely work out better in Pittsburgh.

But of course a lot goes into any such assumption. And that is one of the reasons I strongly recommend that newcomers rent before buying--to maximize your odds of staying in the place you buy for that long, you need to make sure it is the right choice, and renting first gives you time to assess that.

[gg]

Originally Posted by PeterRabbit

"Historical average gain: 3.91%"

Ouch. Factor in school tax and you are left with very little. You pretty much need to by distressed properties and work on them inside out to do okay in our area.

[BrianTH]

Just a reminder: the notion that the universe would pay you to live somewhere makes no sense, and historically that hasn't been the case in the United States (and much of the recent evidence to the contrary turned out to be illusory).

So you should assume that both owning and renting will cost you money. The question is which is going to cost more.

[mckeesport_alum]

Renting doesn't mean you avoid paying property taxes. You do, you just don't see it spelled out. Higher property taxes translates into higher rent. At least when you own the property you can deduct those costs from your income if you itemize.

[BrianTH]

Originally Posted by mckeesport_alum

Renting doesn't mean you avoid paying property taxes. You do, you just don't see it spelled out. Higher property taxes translates into higher rent. At least when you own the property you can deduct those costs from your income if you itemize.

All true, but the landlord can deduct property tax as well, so there is a tax break either way.