Buying a home is cheaper than renting in only 4 U.S. cities.

A study by real estate company Redfin found that only four major U.S. cities are now more profitable to buy a home than to rent. They are Detroit, Philadelphia, Cleveland and Houston.

In all other major cities, from San Jose, California, to Pittsburgh, Pennsylvania, it is financially more profitable to remain a renter.

The main reason for this situation in these four cities is that they did not experience as much of an increase in housing prices during the pandemic as other major U.S. cities. Home prices nationwide rose by double-digit percentages during the pandemic, and now buyers are facing rising mortgage interest rates.

To make home buying a''more favorable than renting in most cities, interest rates should be 4% to 3%. Currently, the average interest rate on a 30-year loan is more than 7%, twice as expensive as it was in 2021 and early 2022, when interest rates were around 3% or even lower.

National statistics show that owning a home costs homeowners 25% more than renting.