Owning a median-priced, three-bedroom home is more affordable than renting a three-bedroom property in 53 percent of U.S. counties, but El Paso County is not one of them.
Renting a home in the Pikes Peak region is more affordable than purchasing a comparable property, but only slightly, according to the latest rental affordability report from ATTOM Data Solutions, a property data provider based in Irvine, California.
ATTOM’s data showed that the average monthly rent for a three-bedroom property in El Paso County rose 7.9 percent, from $1,656 in January 2019 to $1,786 at the beginning of this year.
Weekly wages in the same time frame increased 4.3 percent, from $936 in January 2019 to $976 this year.
ATTOM calculated a rental affordability score, which is the average fair market rent for a three-bedroom property as a percentage of the average monthly wage, based on average weekly wages.
For El Paso County, the rental affordability score was 42.2 percent.
A similar formula was used to compute home affordability scores, which is the monthly house payment for a median-priced home as a percentage of the average monthly wage.
El Paso County’s home affordability score was 43.6 percent. That’s based on the average home sale price in January-November 2019 of $308,900.
Other findings for El Paso County were that home prices are rising faster than rents and that both rents and home prices are appreciating faster than wages are increasing. See the full report here.
Of the 855 U.S. counties analyzed for the report, home ownership was the more affordable housing option in 53 percent. However, the analysis showed a split between different-sized markets, with ownership more affordable mainly in lightly populated counties and renting more affordable in more populous suburban or urban areas.
The analysis incorporated recently-released fair market rent data for 2020 from the U.S. Department of Housing and Urban Development, wage data from the Bureau of Labor Statistics and public record sales deed data from ATTOM Data.
“Home ownership is a better deal than renting for the average wage earner in a slim majority of U.S. housing markets,” Todd Teta, ATTOM’s chief product officer, said in a news release. “However, there are distinct differences between different places, depending on the size and location from core metro areas.
“For sure, either buying or renting is a financial stretch or out of reach for individual wage earners throughout most of the country in the current climate,” Teta said. “But with interest rates falling, owning a home can still be the more affordable option, even as prices keep rising.”
Renting is more affordable than buying a home in 94, or 69 percent, of the 136 counties in the report that have a population of at least 500,000 or more, including El Paso County.
The report shows that renting a three-bedroom property requires an average of 37.6 percent of weekly wages across the 855 counties analyzed for the report.
Park County, Colorado. is one of the least affordable rental markets, requiring 74.3 percent of weekly wages. Marin County, California, outside San Francisco, and Honolulu and Kauai counties in Hawaii also were among the least affordable markets for renting.
The nation’s most affordable market for renting is Roane County, Tennessee, west of Knoxville, with 20.1 percent of average wages needed to rent. No Colorado counties were among the top 10 most affordable rental markets.