T
he American Dream of homeownership is within reach for many, but the path to affordability is fraught with challenges. According to ATTOM's 2025 Rental Affordability Report, purchasing a home is more cost-effective than renting in over half of U.S. counties, despite rising median home prices and stagnant wages.

    A closer look at the data reveals that housing costs typically consume between 25% and 60% of average worker wages nationwide. However, in nearly 60% of the 341 analyzed counties, major homeownership expenses on single-family homes require a smaller share of wages than renting a three-bedroom residence. This trend is particularly pronounced in the Midwest and South, where ownership requires less than half of wages in about 80% and 60% of counties, respectively.

    For those who can afford a down payment, buying a home remains the more affordable option, despite median home prices rising faster than average rents over the past year. In fact, ATTOM's CEO Rob Barber notes that finding an affordable home is like searching for a diamond in a pile of marbles – it's getting tougher as prices continue to climb.

    However, Barber cautions that rising mortgage rates could impact affordability, stating that the situation remains fragile, particularly if rates continue their upward trend. Nevertheless, homeownership is currently the better financial option in most areas, with median home prices having risen or declined at a slower rate than average three-bedroom rents in 225 of the analyzed counties.

    Regional disparities in homeownership affordability are stark, with the West bucking the trend and renting remaining the more affordable option in roughly 80% of western markets. Among the largest counties where home prices have increased more than rental rates are Los Angeles County, CA; Cook County (Chicago), IL; Maricopa County (Phoenix), AZ; San Diego County, CA; and Orange County, CA.

    Conversely, in 116 counties (34%), average rents have risen more than home prices. The most populous of these counties include Harris County (Houston), TX; Tarrant County (Fort Worth), TX; Bexar County (San Antonio), TX; Suffolk County, NY (outside New York City); and Franklin County (Columbus), OH.

    The largest gaps in affordability favoring homeownership are found in counties such as Suffolk County, NY; Atlantic County, NJ; Collier County, FL; Indian River County, FL; and Charlotte County, FL. In contrast, renting remains the more affordable option in major markets like Alameda County, CA; Honolulu County, HI; San Mateo County, CA; Santa Clara County, CA; and Loudoun County, VA.

    While affordability remains a challenge nationwide, homeownership is currently the better financial choice in most markets – particularly in the Midwest and South. However, factors such as rising mortgage rates and regional price trends could shift the balance in the future.