Buy, Rent or Share?

In this challenging economy, are you reluctant to buy big ticket items? Weary of making any kind of long-term monetary commitments? That may not be the most financially advantageous decision. Our informal take — on what to buy, rent or share.

What to Buy: Home

Zillow looked at the breakeven point of more than 200 metros and 8,000 cities to see how many years it would take before owning a home would be more financially advantageous than renting. And guess what? The analysis shows that in most major markets in the U.S. right now, buying beats renting after just three years. This is due to a combination of factors, says Zillow Chief Economist Stan Humphries: affordability (in some markets, values are 50 percent or more off their peak), historically low interest rates and rising rents. Did you know that nearly 4 million American families have transitioned into rentals since the foreclosure crisis began? That’s putting pressure on prices, says Humphries: rents are up 5 percent this year and are expected to continue to rise.

What to Rent: Designer clothing & accessories, textbooks

Whether you have a special event to attend or even if you’re looking to dress to impress for a job interview, I say “thumbs up” to renting outfits you’ll likely need just once. Consider popular sites like Rent the Runway or Bag Borrow or Steal. As for textbooks, which can also make a huge dent in your savings if bought new (costing over $1,100 on average, per year), look no further than chegg.com. Services such as campusbookrentals.com also offer new and gently used textbooks at a significant discount.

What to share: Cars, bikes, vacation rentals, sublets & more

This is a phenomenon already well-established among car sharing services like Zipcar and Car2Go, for example, but look around and you’ll see that this trend of resource sharing is rising everywhere — you’ve got Spinlister for bike sharing, Airbnb for house sharing and other sites for everything else in between.

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Vera Gibbons is a financial journalist based in New York City and is a contributor to Zillow Blog. Connect with her at http://veragibbons.com/.

Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.