Milpitas North San Jose Berryessa Real Estate News

Owning a home is more affordable than renting in 74% of major U.S. cities, according to Trulia's Summer 2011 Rent vs. Buy Index.  The index compared the median list price and the median annualized rent on a two-bedroom apartment, condominium, or townhouse in America's 50 largest cities based on population.

The top five cities where buying is cheaper than renting are Las Vegas; Detroit; Mesa, Arz; Fresno, Calif; and Arlington, Texas.

Cities where it clearly is better to rent are New York; Fort Worth, Texas; Omaha, Neb; Seattle; San Francisco; and Kansas City, Mo.

There is, however, a gray area.  Depending on personal circumstances, such as one's tax bracket, it may make more sense to buy a home in Oakland, San Jose, or Los Angeles, Calif; Austin, Texas; Memphis, Tenn; Boston; and Portland, Ore, even though it is still relatively cheaper to rent.

As Trulia defines it, the total costs of homeownership include mortgage principal and interest, property taxes, hazard insurance, closing costs at time of purchase, and ongoing HOA dues and private mortgage insurance, where applicable.  It also includes an offset for the tax advantages of homeownership, including mortgage interest, property tax, and closing cost deductions.