MEMPHIS, TN — New homebuyers in Memphis are now facing a much larger monthly bill than renters, according to a Zillow analysis highlighted by FOX13 Memphis. Zillow says the average payment for a new buyer is more than $2,100 a month when mortgage costs, taxes and insurance are included.
That compares with an observed rent index of $1,400 in the city, leaving a gap of roughly $700 a month. For people trying to move from renting to owning, the numbers show how quickly the financial picture has changed.
Memphis renter Tamieka Holmes said she hopes to own a home one day, but the math has made that goal feel distant. She said she wants something she can pass down to her children, but right now she expects to keep renting.
Why the monthly gap has widened in Memphis
Zillow senior economist Kara Ng said the affordability gap has grown because home values rose sharply during the early part of the pandemic and borrowing costs remain elevated. When prices and interest rates both move higher, the monthly payment for a new buyer climbs fast.
Ng told FOX13 Memphis that higher borrowing costs are a key reason the payment burden is so much larger for buyers than renters. Even if a house looks manageable at first glance, the added cost of financing can push the monthly total well beyond what many households can afford.
The result is a market where renting may look cheaper month to month, even as the long-term benefits of owning continue to attract buyers who can make the jump.
A renter says owning feels out of reach right now
Holmes, who rents in Mitchell Heights, said she is trying to buy a house but has found the process difficult. She described the effort as frustrating and said she is likely to keep renting for now.
Her comments reflect the reality many prospective buyers are dealing with as they compare current mortgage payments against rent. For households watching monthly expenses closely, an extra several hundred dollars can make the difference between qualifying for a home and staying put.
Holmes said she wants a home she can leave to her kids when she gets older. That long view is part of why ownership matters to many families, even when the near-term cost is steep.
Forward Memphis says ownership can build stability over time
Travis Moody, chief executive of Forward Memphis, said buying a home usually requires a bigger investment at the start, but he believes the payment can become more stable over time. A fixed monthly mortgage, unlike rent, does not rise in the same way once it is locked in.
Moody said that stability can help families build generational wealth. He described homeownership as an investment in the future, even though the first step is often more expensive than continuing to rent.
At the same time, Moody acknowledged that renting is cheaper in the short run. His view was not that everyone should buy, but that ownership can pay off for people who are ready for the commitment and can manage the upfront costs.
Renting still makes sense for people who want less responsibility
Not everyone in Memphis sees buying a home as the best fit. Renter Dolores Rivers said she is comfortable continuing to rent because it matches her current situation as a single person living alone.
Rivers pointed to the practical advantages of renting, including having repairs handled by someone else and not having to worry about lawn care. For her, those everyday conveniences outweigh the appeal of ownership for now.
Her perspective shows why the rent-versus-buy decision is not only about money. Lifestyle, household size and how much responsibility someone wants to take on all shape what makes sense from one family to the next.
What the Memphis numbers mean for households deciding whether to buy
The Zillow figures give a clear snapshot of the housing tradeoff in Memphis: lower monthly rent versus a much larger mortgage payment for new buyers. With rent around $1,400 and average buyer payments above $2,100, the gap is wide enough to reshape household budgets.
For some people, that difference may push homeownership further down the road. For others, especially those focused on long-term stability or building wealth, the higher payment may still be worth it if they can qualify.
What stands out in Memphis is not just that buying is more expensive than renting, but how much more expensive it has become as rates, prices and insurance costs are layered together.
First-time buyers continue to search for ways to bridge the gap
FOX13 Memphis noted that there are ways for first-time buyers to look for help with a down payment or other parts of the purchase process. Those kinds of programs can matter when the monthly burden is already stretching household finances.
Still, the core challenge remains the same: the cost of getting into a home is high, and the monthly payment is higher than what many renters are currently paying. That is why the decision to buy in Memphis often comes down to timing, savings and how much financial risk a family is willing to take on.
For now, the Zillow comparison suggests that Memphis renters who are thinking about buying will need to plan carefully before making the leap.
More on what homes, rents and new builds are doing near you, on RHS Commoner.
