Rent vs Buy, Measured City by City: Real Rents Covered P&I in 61% of 628 Cities

In Gary, Indiana, the median closed rental listing in Gary closed at $1,500 a month over the last 12 months. The principal-and-interest payment on the median home that sold there, with 20 percent down at 6.5 percent, was $455. In Newport Beach, California, the median achieved rent was $7,200 and the same payment was $17,369. Same country, same 12 months, and a renter's dollar bought wildly different things relative to a buyer's.

Across the whole measured universe, the rent side won more often than most people guess. In 384 of 628 cities (postal areas), 61.1 percent, the median achieved rent covered monthly principal and interest (P&I) on the median sold home. In the median city, rent cleared P&I with about $158 a month to spare.

That finding ships with a warning label we intend to keep attached: P&I is not the cost of owning, it is only the financed part. This article reports the coverage numbers and then shows how fast they fall apart when the rest of ownership walks in.

The coverage curve

At the national medians (median of city medians across the 628 gated cities): achieved rent $2,324.50 a month, sold home price $419,950 (homes: houses, condos, and townhomes), and P&I on that price at 6.5 percent, 20 percent down, 30-year fixed, $2,123.50. The median city-level rent-to-P&I ratio was 1.076.

Coverage moved hard with the rate:

One percentage point of rate, from 6.0 to 7.0, flipped 93 of 628 cities out of coverage. The breakeven APR at the national medians was 7.39 percent: the 30-year rate at which P&I on the median-of-cities price ($419,950, a $335,960 loan after 20 percent down) exactly equals the median-of-cities rent of $2,324.50. A related threshold: at 7.22 percent, exactly half of the 628 cities covered.

What we measured

Rent is each city's median achieved lease: the rent at which listings actually closed, not asking prices, drawn from a national corpus of just under 3 million achieved leases; each city's median uses only leases signed inside the 12-month window. The distinction matters. In our asking vs actual rent study, asking rents ran a median 8.7 percent, about $200 a month, above achieved rents, and asking exceeded achieved in 84.1 percent of that study's 993 markets. A rent-vs-buy comparison built on asking rents flatters the rent side of the ledger.

Price is the 12-month median sold price for homes (houses, condos, townhomes) in the same city. P&I is a standard 30-year amortization on 80 percent of that price. Both windows are the trailing 12 months at the 2026-08-22 snapshot.

Gates: a city qualified with at least 150 achieved leases in the last 12 months and at least 400 closed sales; 628 cities (postal areas) cleared both, and every share in this article uses that denominator. National figures are medians of city medians.

What P&I excludes: property taxes, insurance, HOA dues, maintenance, vacancy, and any return the down payment could have earned elsewhere. One more mix note: the rent median blends unit types (houses, condos, apartments) while the price median covers homes; where a city's lease mix is condo and apartment heavy, we flag it in the table.

Where rent ran furthest over P&I

Largest rent-over-P&I surplus, dollars per month at 6.5 percent:

*Flagged rows, kept in the table rather than excluded: in La Quinta and Indio, achieved rents ran 18 to 25 percent above asking in the same corpus, a pattern consistent with seasonal winter leases in the Coachella Valley inflating the achieved median; we could not check lease terms at the record level, so treat those surpluses as unconfirmed. In Bloomington, achieved ran 49 percent above asking, consistent with academic-year and group leases in a college town.

Three of the ten are South Florida cities with condo-heavy lease mixes (Deerfield Beach 32 percent house, Delray Beach 29, Lauderhill 30), so their rent medians lean on condo and apartment leases. Florida also carries insurance costs far above the national assumption in the sensitivity test below, so those rows gave back more of their surplus to carrying costs than the table suggests. Abilene's $2,499 is not a typo; its lease sample is 85 percent houses.

Robustness, scoped to these ten rows: every row with at least 100 house-only leases showed a house-only ratio at or above its mixed ratio, so the surpluses are not an artifact of cheap apartments in the rent median.

Where the payment buried the rent

Largest P&I shortfall, dollars per month at 6.5 percent:

Nine of the ten are California coastal or Bay Area cities; Bellevue, Washington is the only exception. In Newport Beach the median achieved rent was well under half the payment, a ratio of 0.41: renting the median home there ran roughly $10,169 a month cheaper than financing the median sold home, before a single tax or insurance bill. Within these ten rows, house-only ratios also stayed well below 1.0 wherever they could be computed, so the verdicts do not hinge on apartment-heavy rent medians.

Why 61 percent does not mean buying was cheaper in 61 percent of cities

Rent covering P&I is necessary, not sufficient, for positive cash flow. It is a screen, never proof, and never "buying is cheaper." Here is what happened at 6.5 percent APR when we let the rest of ownership into the comparison:

A mainstream tax-and-insurance assumption removed 235 cities at a stroke, and in Florida, where premiums run far above that blended 1.5 percent, the real collapse was steeper than the table shows. The honest reading: in 3 of 5 gated cities, actual rents were high enough to carry the loan payment alone, which is a genuinely useful screen for buyers and landlords, and nowhere near a cash flow statement. Our rental property cash flow guide walks through every line P&I leaves out.

Everything above is realized data, closed rental listings and closed sales inside the window. Nothing here forecasts rents, prices, or rates.

Related studies

This article is one of three built on the same achieved-lease corpus: Does the 1 percent rule still work? counts the cities that cleared the classic investor screen, and The best rental yields in America ranks all 628 gated cities by gross rental yield (12 times the median achieved lease over the median sold home price, before all expenses). The gap that motivated the whole series, advertised rent versus the rent listings actually closed at, is measured in our asking rent vs actual rent study.