HAPCO Philadelphia says a new study out by Redfin that claims it’s cheaper to buy than you rent in Philly is flawed and makes faulty assumptions.
HP President Greg Wertman examined Redfin’s methodology outlined in their study.
“They are comparing a monthly mortgage of $1,869 to a monthly rent payment of $2,000. A $1,869 payment means the house cost less than$280,000 with 5% down. And that doesn’t include PMI costs,” Wertman finds. “That means the house costs less than $250,000. Good luck finding that in a decent neighborhood.”
Wertman goes on to say, “The only city that it makes sense to buy in is Detroit, which I just visited. It used to have a population of almost 2 million. Now, it’s around 677,000.”
HP’s President also says as you read the study, keep in mind that sources like Redfin and Zillow are using information that is readily available through other platforms.
“It’s one of the reasons why Zillow was sued in California a number of years ago for providing information that undersold certain neighborhoods and residences,” Wertman notes.