July 2024 · Investing · 4 min read · by Kinan Sawar, MD — REALTOR® at Shorewest, REALTORS®
High rates flipped the rent-versus-buy calculation on its head in expensive metros — while leaving it intact in affordable ones.
For most of the 2010s, buying beat renting almost everywhere. At 7% mortgage rates, that’s no longer a given.
When financing was cheap, owning built equity for roughly what renting cost. With rates near 7% and prices high, the monthly cost of owning in expensive metros now sits well above the cost of renting the same home — and the gap is paid in interest, not equity.
On the coasts, renting is often the cheaper monthly choice today, and buyers are effectively betting on appreciation. In lower-priced, higher-yield markets across the Midwest and South, buying still pencils out — the rent you’d pay is close to the cost of owning.
Gross rent yield — annual rent divided by price — is the fastest way to sort the two. High-yield markets favor owners and investors; low-yield markets favor renters and appreciation bets. It’s on every county’s ZIP table.
Kinan Sawar, MD — REALTOR® at Shorewest, REALTORS®, serving Milwaukee and Southeast Wisconsin (Milwaukee, Waukesha, Ozaukee, Washington, Racine, Kenosha, and Walworth counties). Email: [email protected] · Phone: (618) 713-2964.
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Home values and rents are Zillow ZHVI/ZORI estimates for the named area, as of 2026-07-03; incomes and population are U.S. Census (SAIPE, Population Estimates); migration is IRS Statistics of Income. Area-level statistical estimates for information only — not an appraisal, and not financial, legal, or tax advice.