Rent vs. the Cost to Own in Colorado Springs

Here is a question worth twenty years of data: how does the cost to rent a home in Colorado Springs compare to the cost to own one, and how has that relationship changed? I pulled three measures to answer it. Median asking rent from the MLS, Zillow's rent index, which covers the whole rental market including apartments, and the monthly payment to own the median priced home in each year.

Three lines, twenty years

Cost to own is principal and interest at that year's rate, plus taxes and insurance, 10 percent down, on the median closed price. ZORI history begins in 2015.

The shape tells the story before any single number does. The two rent lines climb together in a smooth, steady line. The cost to own moves with them until 2021, then breaks away and runs far above both. That break is the whole point.

What the relationship actually is

Rent is the stable anchor. Owning is the volatile line. Both rent measures rose at a steady 3 to 5 percent a year across the whole period and never spiked. Rent tracks what tenants can pay, and that moves slowly. The cost to own swings with mortgage rates and prices, which do not.

For most of the 2010s, owning tracked rent, and often beat it. From 2010 through 2021 the monthly payment to own the median home stayed within about ten percent of MLS asking rent. In 2011 through 2016 it was mostly below rent. Owning the median home cost less per month than renting a comparable one. That is the era when "why rent when you can buy for the same money" was simply true here.

2022 broke the relationship, and it has not reset. When rates doubled against peak prices, the cost to own jumped away from rent. Measured against MLS asking rent, owning went from about even to 1.56 times rent at the 2023 peak, and sits at 1.36 times today. Measured against the broader Zillow index, which runs lower because it includes apartments, owning reached 1.75 times rent and sits at 1.67 times today.

The two rent measures bracket the truth. Owning the median Colorado Springs home today costs somewhere between 36 and 67 percent more per month than renting, depending on whether you compare to single-family asking rent or to the whole rental market. For a decade before 2022, that figure was roughly zero.

The same story in dollars

The ratio is the analyst's version. Here is the one everybody feels. This is the plain monthly dollar gap between owning the median home and renting a comparable one, year by year.

For thirteen straight years, from 2009 through 2021, owning and renting cost essentially the same. The gap averaged almost exactly zero and never ran more than about $130 a month in either direction. There is an old rule of thumb that owning and renting a comparable home should land within a few hundred dollars of each other. The data more than backs it up. The real norm was tighter than that.

Since 2022 the gap has averaged about $872 a month, from $718 up to $1,069. That is not a small drift off the norm. It is six to eight times the widest the two ever got in that whole stable decade.

And the reason it held so steady for so long is worth sitting with. When owning gets much cheaper than renting, renters buy, which firms up prices. When owning gets much more expensive, buyers rent, which firms up rents. That two-way pull keeps the monthly cost of owning and renting tethered to each other, and for thirteen years it did. What broke the tether was not the price getting away from rent. It was the mortgage rate wedging the two apart, and a wedge like that closes, through some mix of rents rising, prices giving, and rates easing.

One more detail that matters

Rents have flattened since 2023. The Zillow index read $1,705, then $1,736, then $1,735, then $1,754 across 2023 to 2026. Nearly flat. MLS asking rent did the same. So the gap is not staying wide because rent keeps climbing. It is staying wide because the cost to own locked in high and has not come back down.

That is the same conclusion as the question of what would restart home sales, seen from the renter's side. Rent did not blow out. The ownership payment did, and it did it because rates doubled while prices held near the top. Until the cost to own eases back toward rent, the math that made buying an easy call for most of the last fifteen years does not come back.

You can model your own numbers on the home payment calculator, see the rent trend on the Colorado Springs rent tracker, or read the companion piece on what it would take to get the market moving again.

Sources: median asking rent from ELEVATE MLS leased records; the Zillow Observed Rent Index for the Colorado Springs metro, which covers single family, condo and multifamily rentals; median closed price from El Paso County and ELEVATE MLS records; and the reported 30-year average rate. The cost to own assumes 10 percent down, so a VA zero-down buyer's gap is wider still. Prepared by Rob Thompson, Realtor, Iconic Colorado Properties.