According to recent data released by Trulia it is still significantly cheaper to own in the DC region then to rent, 34% to be specific. This has been consistent all year and is slightly below the national average of 38%. Jed Kolko, chief economist for Trulia provides in-depth analysis providing further breakdown. For instance, it is 25% cheaper to own in Fairfax, VA than it is to rent, while it is 33% cheaper to own in the District of Columbia.
Trulia calculates this by using several factors, which includes average utility bills and tax deductions amongst other things, but one very important factor that was discovered was that the owner must remain in their home for at least 7 years. Trulia used many different variables to make these calculations like changing the length of the mortgage or type of loan, and every time ownership beats out renting.
This data lends significant strength to the solution of homeownership as a vehicle to help low-to-moderate income individuals achieve economic mobility. The District of Columbia already has programs in place to help lower income individuals purchase homes, like the HPAP program and development subsidies, but more can be done on the side of our financial institutions. A piece of legislation, the Community Development Amendment Act of 2013 would incentivize community development by evaluating the community development plans of financial institutions that apply for financial contracts with the city, and assigning contracts partly based on those plans. Now is the time for the city to lead the way in promoting economic mobility and holding financial institutions accountable!