The affordability of renting an apartment in Baltimore is cited by local entrepreneurs as one of the reasons for founding a startup in Charm City, especially compared to its bigger (and more expensive) cousins New York City and Washington, D.C.
But a report from Zillow Inc., the popular real estate site, “found it takes homeowners in Greater Baltimore an average of 2.8 years to break even on their purchases,” according to the Baltimore Business Journal .(In Baltimore city, the average break-even drops to two years even). So why should renters care?
“[W]hile short-term renters probably are making the right decision,” reports the Baltimore Business Journal, “those who live in the same apartment for three years or longer are missing out on the opportunity to gain equity.” Zillow’s chief economist Stan Humphries says that rents nationwide have increased by 5 percent over the last year.
Find the pretty sweet interactive map from Zillow here.
This ‘break even’ horizon, as Zillow describes it, “is the number of years you will need to own and live in a home until it becomes more financially advantageous than renting the same home.”
As the BBJ story notes, the Zillow study “failed to take into consideration the value one finds in not mowing lawns, paying property taxes (especially in the city) and being off the hook when major repairs are needed,” factors that contribute to close to 100 percent of Baltimore’s downtown apartments being filled. That and the need for a down-payment and, you know, perhaps access to a particular neighborhood that buying seems more challenging.