Is it better to own or rent your home? The city by city response

The time required to make a property purchase profitable, compared to a rental, has decreased this year. A first in three years, according to a study by Meilleurtaux. But this average masks very different developments from one city to another.

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Is it more interesting to remain a tenant or to become the owner of your home? With the drop in credit rates relaunching the real estate purchase plans of the French, the debate on the respective advantages and disadvantages of ownership and rental is coming back to the forefront. Particularly on a financial level: in 2024, you must remain the owner of your home for at least 14 years and 8 monthson average, so that its acquisition proves more profitable than its rental, according to a study by the broker Meilleurtaux published on September 10. A duration calculated for an area of ​​70 square meters, depending on the purchase price per square meter, the amount of property tax and co-ownership charges. All of this is compared to the level of rent per square meter and to the return generated by the sum that a tenant can invest, for example in a Livret A at the rate of 3%, instead of devoting it to the personal contribution within the framework of a purchase.

Does 14 years and 8 months seem like an eternity to you? A year ago, it took almost a year longer, or 15 years and 6 months, for home ownership to end up costing you less than renting. This improvement – the first in three years – is to be attributed to the drop in real estate loan rates, reduced from 4% in September 2023 to 3.6% on average for loans over 20 years, and the drop of almost 4% in property prices. old real estate in the space of a year. At the same time, rents “have not declined, due to the shortage of rental properties”adds Maël Bernier, spokesperson for Meilleurtaux. It is therefore a little more interesting than a year ago to buy your main residence than to rent it.

The surge in rents is reshuffling the cards

Especially if you live in Le Mans… In the Sarthe prefecture, by buying your home today, you will have made four years a better deal than if you had remained a tenant. In September 2023, still in Le Mans, we had to wait… 19 years for a real estate purchase to prove more profitable than a rental. “In this city, the price per square meter for purchase has fallen over the last twelve months, while rents have increased because they are not regulated and because the shortage of properties to rent is enormous”deciphers Maël Bernier. The average rent in Le Mans has indeed jumped by almost 11% in one year, according to the National Real Estate Federation (Fnaim).

Same scenario in Mulhouse, where rents have soared by 7% while the purchase price per square meter has been reduced from 1,687 euros in 2023 to 1,319 euros in 2024. As a result, you make your purchase profitable in this sub-prefecture of Haut-Rhin at the end ofonly one year and three months. This is even better than in 2023, when it took a year and 6 months for a purchase to become more attractive than a rental.

The return on investment time should further decrease

In total, the time required to make a purchase profitable has decreased in 17 of the 32 main cities of France studied by Meilleurtaux, as you can see in the infographic below. Conversely, this duration increased by five years in Marseille, as in Aix-en-Provence, to reach 18 and 27 years respectively, by two years in Nice, to reach 22 years, or even by seven years. in Montpellier, where she is now 20 years old. This is the consequence of “the increase in the price of a square meter for purchase, for example to Marseille from 3,604 euros in 2023 to 4,016 euros in 2024, while rents in these cities have remained relatively stable. analyzes Maël Bernier.

The Meilleurtaux spokesperson anticipates a further reduction in the average duration necessary to make a property purchase profitablemainly thanks to the continued fall in rates. But from there to hoping for a speedy return to 2019, there is a gap. That year, a purchase became profitable in less than two years! “At the time, with credit rates between 1% and 1.5% and purchase prices which had not yet experienced the post-Covid surge, everyone had an interest in buying rather than renting , subject to not reselling the property before two years”recalls Maël Bernier. An era undoubtedly passed.