A modelled comparison from Zillow, published September 16, 2026, puts a dollar figure on the gap between renting and buying: $12,792 a year in favor of the renter, measured on a national basis. The same analysis finds that in each of the 50 largest U.S. metros the typical rent is lower than the typical monthly payment for a new homeowner. The national figure and the metro results are two different things, and the second is much more uneven than the first.
How Zillow arrives at $12,792
The number is Zillow’s own, and it is simple arithmetic. In its September 16 release, “The renter’s advantage”, Zillow sets a typical national rent of $1,948 a month against a typical new buyer’s payment of $3,014 a month, a payment that includes taxes and insurance. The difference is $1,066 a month, and $1,066 multiplied by 12 months is $12,792. The release presents it as the yearly cost difference between renting and buying.
Because the annual figure is the monthly gap times twelve, it carries no information beyond the monthly comparison. It is also a national number. Los Angeles, for example, is far above the national gap and Chicago is below it.
The assumptions underneath the comparison
Zillow models the buyer as taking a 30-year fixed-rate mortgage at 6.67% with 10% down. The renter is assumed to invest the monthly $1,066 difference at the 10-year Treasury yield, which Zillow puts at 4.68% as of August 2026. On those terms the first-year investment return comes to $322 nationally, and $8,041 over five years. Zillow states that the analysis assumes rents and homebuying costs stay stable over the period.
This is a comparison of monthly cash cost. It does not count the principal a homeowner pays down each month, the equity that builds as a result, or any tax benefit from mortgage interest, so it measures what leaves the household each month rather than what a household ends up owning. Mischa Fisher, Zillow’s chief economist, frames the result around that cash difference: “When mortgage costs are running hundreds of dollars more per month than rent, renters who are intentional about saving and investing the difference are often making a sound financial decision.”
All 50 metros on Zillow’s list, and the monthly gap in each
The release carries a table of the 50 largest metros alongside the national row, and every one of the 50 shows a positive monthly saving for renters. The metros, in the order Zillow lists them, are New York, Los Angeles, Chicago, Dallas, Houston, Washington, Philadelphia, Miami, Atlanta, Boston, Phoenix, San Francisco, Riverside, Detroit, Seattle, Minneapolis, San Diego, Tampa, Denver, Baltimore, St. Louis, Orlando, Charlotte, San Antonio, Portland, Sacramento, Pittsburgh, Cincinnati, Austin, Las Vegas, Kansas City, Columbus, Indianapolis, Cleveland, San Jose, Nashville, Virginia Beach, Providence, Jacksonville, Milwaukee, Oklahoma City, Raleigh, Memphis, Richmond, Louisville, New Orleans, Salt Lake City, Hartford, Buffalo and Birmingham.
The size of the gap varies enormously across that list. San Jose is at the top with $7,883 a month, which Zillow converts to $94,596 a year. San Francisco follows at $5,413 a month, or $64,956 a year, then Los Angeles at $4,441 a month, or $53,292 a year, and San Diego at $4,235. Seattle ($3,511), Boston ($2,829), Salt Lake City ($2,640), New York ($2,629), Portland ($2,540) and Denver ($2,504) also sit well above the national $1,066.
Where the gap is thin: Pittsburgh, Birmingham and Memphis
At the other end of Zillow’s table, the renter’s monthly advantage is a fraction of the national figure. Pittsburgh shows $536 a month, which works out to $6,432 over twelve months by simple multiplication. Birmingham is at $668, Memphis at $708, Detroit at $734, Cleveland at $764 and Oklahoma City at $792. Chicago, the third-largest metro on the list, is at $882, and Houston at $1,003.
The spread explains why a headline national number and a local decision are different questions. The $12,792 figure is a national typical, set against a table whose metro entries run from roughly $6,400 a year to roughly $94,600 a year, and the 50-metro result says only that the sign is the same everywhere: in each of them, the typical new-owner payment is higher than the typical rent.
Freddie Mac’s 7.28% sits above the 6.67% Zillow modelled
The mortgage rate in Zillow’s model has already been overtaken by the market. Freddie Mac’s Primary Mortgage Market Survey put the 30-year fixed-rate average at 7.28% on October 1, 2026, up from 7.03% the week before and well above the 6.34% recorded a year earlier. Its 15-year rate was 6.60%.
A higher rate raises the interest portion of the monthly payment on a given loan, so with every other input held constant, a buyer at 7.28% would face a larger payment than the $3,014 Zillow modelled at 6.67%. The published $12,792 reflects Zillow’s September assumptions rather than the October market.
Five years or less, and a different measure of rent
Zillow attaches a time horizon to its conclusion. According to the release, across most of the country the rent-versus-buy decision typically favors renting for households that plan to stay for five years or less. The five-year window is where Zillow’s own emphasis sits, and the release does not extend the savings result to longer stays.
Rent itself is also measured differently by different sources. Zillow’s $1,948 is its typical-rent figure, while Apartment List’s national rent report, updated September 29, shows a national median rent of $1,388 that is falling from a year earlier. The two numbers rest on different bases and should not be blended; Zillow’s $1,066 gap depends on its own typical rent and its own typical buyer payment. A separate Zillow analysis, published September 29, found new homes priced at a median $205 a square foot against $212 for existing homes, a 3.3% discount that appears in about one-third of major markets, which is a price measure and not a rent-versus-buy one.
The controlling document for the headline claim remains Zillow’s September 16 table: a $1,066 national monthly gap, $12,792 over a year, and a renter’s advantage in every one of the 50 largest metros it lists.
Housing cost help that sits outside the rent-or-buy math
Zillow’s rent-versus-buy table counts the monthly payment, taxes and insurance, and leaves out the programs that can lower what a household pays to keep a roof overhead. Property-tax relief and heating and cooling help each have their own applications and renewal dates, and the gap between a comparison like Zillow’s and a filed application is where costs stay higher than they have to be.
The Senior Property Tax & Home-Cost Relief Kit is an 11-page kit that covers the 5 kinds of property-tax relief and the circuit-breaker credit that includes renters, with an application log and renewal calendar for tracking the dates.
Check the renter and homeowner relief routes in The Senior Property Tax & Home-Cost Relief Kit →
This piece was drafted with AI assistance; the figures were checked against Zillow’s September 16 analysis and Freddie Mac’s October 1 mortgage survey.
