These are the cities where it pays to be a homeowner rather than a renter

Florida-based AD Mortgage released a study this week that compares the costs of renting and owning a home, with the analysis showing that home equity accumulation often pays more over time versus the alternative of renting and investing a potential down payment in the stock market.

The analysis compared typical city-level home values and rents using Zillow data. It also assumed the use of a standard 30-year fixed-rate mortgage at 6.11%, then projected outcomes over a 10-year period using state-level home price growth and an S&P 500 benchmark return of 10.35% compounded annually.

“Our goal with this study is to provide a clear, data-backed perspective on one of the most important financial decisions consumers face,” Max Slyusarchuk, CEO of AD Mortgage, said in a statement. “By analyzing long-term outcomes, we aim to support more informed conversations between borrowers and mortgage professionals.”

The lender’s study looked at the five most populous cities across all 50 states — 250 cities in total — using home value and rent price data as of March 17, 2026. It assumed that ongoing property taxes, homeowners insurance and maintenance would cost 2.5% of a home’s value annually.

Additionally, future home price growth was projected using the past 10 years of state-level price data from the Federal Housing Finance Agency. For renters, the study assumes any potential down payment was invested in the S&P 500. These total returns were compared to projected home equity accumulated after 10 years of homeownership to determine whether renting or buying was more profitable.

Homeownership was the more profitable choice in all 250 cities in the analysis when assuming a renter reinvested a potential down payment in stocks. And even when assuming a household reinvested both the down payment and any monthly savings from renting, homeownership came out ahead in 199 cities, or nearly 80% of the sample size.

Markets where homeownership wins

Many fast-growing markets in the Sun Belt show a large “equity advantage” for homeowners, even in locations where the monthly cost of owning exceeds that of renting, AD Mortgage found.

Miami topped this list as accumulated equity over 10 years was projected to top $1.043 million, largely tied to estimated home price growth of 149% over that period. The advantage of owning in Miami totals $509,451 after 10 years, even though the monthly cost of owning there ($3,981) is significantly higher than the cost of renting ($2,964).

Three other Florida cities were listed in the top five nationally in terms of having an equity advantage: St. Petersburg ($361,852), Tampa ($340,562) and Orlando ($317,027).

Idaho also ranked highly for owner profitability as Meridian was No. 3 nationally with an equity advantage of $349,590 after 10 years. And the other four cities in the Gem State that were analyzed — Boise, Nampa, Caldwell and Idaho Falls — each had equity advantages of at least $234,000.

Other major cities where homeownership paid off relative to renting included Las Vegas ($222,457 more than renter-investors), Charlotte ($123,308) and Seattle ($90,628).

These markets illustrate the study’s core point: Even when the monthly gap between owning and renting is large and results in negative cash flow for homeowners, long-term home equity growth can dominate the renter-investor path under the stated assumptions.

AD Mortgage also uncovered 26 cities where the monthly cost to own a home was less than renting. Detroit led the way as owning a typical home there costs $799 per month less than renting one. Other major markets that fell into this category include Cleveland ($556 per month less); Baltimore ($407); Birmingham, Alabama ($375); Philadelphia ($143); and Chicago ($125).

“These cities represent the strongest ownership case in the study: markets where buying does not require a monthly affordability sacrifice and still provides the long-term wealth-building benefits of leverage, appreciation, and principal paydown,” the study explained.

Markets where renting and investing wins

In a smaller set of cities — often high-cost or low-growth markets — the renter-investor path outperforms homeownership on a 10-year horizon.

In Los Angeles, for example, even as projected equity accumulation totals more than $1.15 million after 10 years, renters who invest their hypothetical down payment and monthly savings come out ahead by roughly $163,000.

Three other California cities — San Jose, San Diego and San Francisco — also saw long-term advantages for renters ranging from about $169,000 to $449,000.

AD Mortgage singled out low-cost markets in North Dakota where equity disadvantages of $105,000 to $160,000 emerge after 10 years, which are “driven by relatively modest projected price growth versus the assumed equity market returns.” Similar disadvantages for homeowners can also be found in higher-cost markets like Cambridge, Massachusetts; Pearl City, Hawaii; and Arlington, Virginia.

For real estate agents and mortgage loan officers, these markets underscore the importance of aligning home purchase decisions with buyer’s expected holding period, income volatility and risk tolerance, rather than assuming that homeownership will always dominate on a 10-year timeline.

The analysis mentioned multiple “assumptions and limitations” that should be taken into consideration, noting that “these are modeled outcomes under fixed assumptions, not personalized guidance.”

For example, the 6.11% mortgage rate and 10.35% compounded return for stocks that were used for analysis purposes are “static and backward-looking,” the study noted, and “actual results will vary with future rates and market returns.” Similarly, state-level home price appreciation data “may overstate or understate outcomes in individual neighborhoods.”

Full details of the 250 cities analyzed by AD Mortgage are available here.