The city of Seattle has plenty to offer visitors and prospective residents alike — beautiful landscapes, a vibrant culture and a wealth of museums and attractions. But unfortunately, that popularity and allure comes with its own downsides. One of them is the ever-worsening housing affordability crisis. 

It’s no secret that property prices are making it more difficult to own a home all across the United States, and Seattle is no exception. Once listed as one of the most affordable cities in America, Seattle is now suffering from the same shortage of affordable housing that plagues other major metropolitan areas. It’s bad enough that many residents are choosing to rent indefinitely rather than trying to buy a home. But is that truly the more affordable option? 

Rent vs. mortgage: the hard numbers 

In the Seattle-Tacoma-Bellevue area, buying a home is significantly more expensive than renting one. According to a study by Bankrate, purchasing a property in the Seattle area can cost 125% more than renting. The median mortgage rate in Seattle has surged enough that affording a home is simply beyond the reach of many residents — and it doesn’t look to be getting better anytime soon. 

Why the high prices? 

So why is it becoming such a challenge to afford a home in Seattle? Largely, it comes down to the same issues as elsewhere in the country: 

• Imbalance of supply and demand. As with many major cities, the demand for affordable housing outstrips the supply. This translates to higher prices, as high as the market will bear. Combine this with population growth and limited construction of new housing, and you have a seller’s market that’s highly competitive, meaning bidding wars that drive prices up even further. 

• Seattle has certain geographic constraints that limit the land available for development. It’s surrounded by water and mountains, which makes for great views, but also means land to build on is scarce — and they’re not making any more of it. As with demand, more scarcity means higher property values. 

• The tech industry in Seattle has been in a boom for years, which is great news for high-income professionals, but not so great for residents of more modest means who are looking for a home. An ongoing influx of affluent buyers means prices go up. 

• Seattle’s building regulations and zoning laws are also something of a problem, as they make it more challenging to develop new housing projects. This is only exacerbated by the scarcity of suitable land to develop on. 

Why is Renting Cheaper? 

When it comes to mortgage payments versus renting in Seattle, the difference is clear: a house payment in Seattle starts at about $2,700 and can range up to over $4,000, while renting a house starts at about $2,000 and ranges up to $2,600. And that’s before you factor in the other expenses of owning a home. Unfortunately for homeowners, buying instead of renting doesn’t necessarily lead to more living space, either. 

For example, homeowners are responsible for their own maintenance and repairs on their property. Having to replace a roof or fix serious plumbing problems can be a major expense. Renters, on the other hand, don’t have to worry about that sort of thing — it’s the landlord’s financial responsibility. The tenant just has to make sure the landlord fulfills their responsibilities to do those repairs. 

There’s also the reality of property taxes. Homeowners in Seattle face high property taxes, which add to the cost of home ownership. As property values go up, so too do those taxes. 

Home insurance and renters insurance also differ significantly in price. Due to the rising cost of natural disasters due to climate change, homeowners insurance is an average of $187 per month on top of mortgage payments and property taxes. But per numbers from The Zebra’s Ross Martin, renter’s insurance in Seattle is much less expensive at $146 … per year. You read that correctly — if you rent in Seattle, you can insure your belongings and safeguard your legal liability for the price of a few cups of coffee. It can get even cheaper if you shop around and compare; for instance, choosing PEMCO as your insurance provider can bring those premiums down to around $90 a year. 

Finally, homeowners face many more up-front costs when they buy a home, such as closing costs, agency fees, a 20% down payment and more. A renter only has to provide a security deposit and perhaps first and last month’s rent. 

With the housing market being the way it is in Seattle, it’s no wonder so many residents are choosing to rent rather than buy. Renters can’t build equity over time, which can be a major drawback, but the realities of the Seattle housing market make renting the smarter choice for many.