SEATTLE—Buying a home now takes a smaller chunk of monthly income than renting—provided that high rents haven't sapped the would-be homebuyer's ability to make a down payment. That's the word from Seattle-based Zillow, which also reported that it's now more affordable to buy a home than it was in 1999, whereas the opposite is true for renting.

On average, homebuyers should expect to spend 15.3% of their incomes on monthly mortgage payments, compared to the 29.9% share of income that's entailed in writing out a rent check. Today's mortgage check is smaller as a share of monthly income than it was between 1985 and '99, when 22.1% was the historical norm.

Although the proportions vary by metro area, by and large that's the case in most of the markets in Zillow's study. In Miami, for example, mortgage payments take 19.9% of monthly income compared to rent's 44.5% share of income. In New York City, the figures are 25.6% and 40.5%, respectively, while in Dallas they're 11.3% and 27.7%.

Zillow's chart of 34 major reveals one exception to the rule, but the differences aren't as lopsided in favor of renting as they are for buying in 33 of the 34 metros. Renters in Silicon Valley pay out 37.9% of their monthly income, compared to 38.2% of income that goes toward mortgage payments.

Further, the study shows that it was 30.8% more affordable to buy a home in the third quarter than it was 15 years ago, while it was 19.8% less affordable to rent during the same time period. Younger homebuyers, with lower incomes and therefore smaller down payments, should expect to shell out 17.4% of their monthly incomes to mortgage payments.

"Despite rising home values, homeownership remains very accessible for buyers that can scrape together a down payment—even if that down payment is relatively modest—find a home to buy and secure financing," says Stan Humphries, Zillow's chief economist. A major worry, though, is “the fact that it still remains so difficult for so many potential buyers to make those particular stars align, largely because renting is so unaffordable these days.”

It's a challenge, Humphries says, to come up with a down payment “when so much of your monthly paycheck, especially on an entry-level salary, is going to your landlord instead of into your savings. Buying conditions are getting better every day, and in time the allure of fixed housing payments and building wealth through home equity will draw more buyers out of rentals and into homeownership."

Instant Insights /

As MF Rents Rise, Buying is Cheaper

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