CHARLOTTE, N.C. — While many people are jumping in on the home buying craze, a new study says you’re actually saving money in the near term by staying in your apartment or that house you’re renting.

What You Need To Know

  • Mortgage analytic website Compare the Market reports the average U.S. mortgage payment is 18% higher than the average rent

  • While it costs on average $1,900 a month to rent a three-bedroom home, a mortgage payment is about $2,300 for the same size home, Compare the Market says

  • Home buyers like Shauntae Griffin say spending more on a mortgage will pay off in the long run when the home gains equity

This week, the Federal Reserve said the 30-year fixed mortgage rate is averaging 5% for the first time in more than a decade — and that's affecting the choice between renting and buying.

Mortgage analytic website Compare the Market reports payments on home loans nationwide are nearly 20% higher than the average monthly rent in the U.S.

But home buyer Shauntae Griffin says she's playing the long game. 

“At the end of the day, Charlotte is continuing to grow, and the equity in the homes is continuing to rise,” she said.

She's willing to pay hundreds more per month if it means owning a home and no longer renting. Data from Compare the Market shows she should brace for a jump of at least a $400 a month.

Compare the Market reports that while it costs $1,900 a month to rent a three-bedroom home, a mortgage averages $2,300 a month – nationwide.

Griffin says if she wants to continue living in her northeast Charlotte neighborhood, she has to prepare to spend even more than that.

Experts at nerd wallet say if you’re looking to compete in this market, be prepared to pay cash or have a higher down payment. 

They say you can also use what’s called an escalation clause – where you can increase your bid little by little over a certain time frame to beat out other buyers.