Thinking about getting a starter home in the Pittsburgh region?
Generally, a more affordable option for first-time buyers, starter homes in the 50 biggest metro regions in the United States – Pittsburgh included – make more financial sense than renting.
In January, the national median rental price for a home or apartment rose 19.8% compared to the January prior. That marked the eighth month in a row of gains over 10%, according to Realtor.com’s Monthly Rental Report.
In Pittsburgh, the cost to buy a starter home was 38.3% less than renting, or $585 on average. According to the report, buyers who purchased starter homes spent about $945 per month on their housing costs, compared to $1,530 for renters.
Home prices have increased 3.2% in Pittsburgh from 2020 to 2021, but rents have grown 18.6%. Pittsburgh was third on the list of places where buying a starter home was more affordable than renting, after Birmingham, Alabama and Cleveland, Ohio.
Studio apartments rented at an average increase of 21% -- $256 was the average – while one-bedroom apartments rose in rent 19.2% to an average of $323 a month.
The cost to a buy a home is also on the rise, though not as sharply. The cost of a two-bedroom home rose an average of 11% in 2021 over 2020 nationally.
As long as buyers focus on starter homes, properties are generally more affordable. The average starter home was listed for $295,360, nearly $80,000 below the national median of $375,000, according to the Realtor.com report.
However, adding in mortgage fees and other starter costs, the average monthly home payment of $1,867 was slightly more than renting – the average was $1,789 -- across the U.S. In 52% of markets though, buying a starter home was 20.6%, or $323 on average, cheaper than renting.