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The average home price in the Big Apple is nearly $2 million, making New York City the most sensible place to rent.
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updated 11/19/2010 9:54:35 AM ET 2010-11-19T14:54:35

We're all aware that the housing market, well, stinks right now. With an excess of supply and lowered demand, it's a buyer's market — but is that true everywhere? Here are 10 cities where renting rules, and why you're better off writing your landlord a check than taking on a mortgage.

1. New York
Average List Price: $1,879,000
New York: if you can make it there, you can make it anywhere, right? That certainly holds true for real estate, because the average home price in the Big Apple is nearly $2 million. Rent is high too, but it still makes more sense than owning a home: According to Trulia, New York City's rent-to-buy index is 35, meaning that it would take 35 years of renting before you match homeowners' expenses. That rent check may make you cringe, but it beats paying a mortgage in New York.

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2. Seattle
Average List Price: $585,073
While the rest of the country is upside-down on their mortgage, Seattle has been a fairly stable housing market. With ample jobs and desirable location, the average home lists at over half a million dollars — a stiff mortgage check to write if you're a homeowner. If you factor in homeowner expenses and tax benefits, this city has a rent-to-buy index of 31. Considering you'll have to hang tight for more than three decades to beat renting in Seattle, paying the landlord is downright financially savvy in this city.

3. Fort Worth, Texas
Average List Price: $207,730
Although real estate prices are reasonable in most of Texas, Fort Worth is an exception to this rule. The rent-to-buy index for Forth Worth is a whopping 30 — so you can be a proud renter if you call this Longhorn State city home. Ample jobs are suspected, keeping real estate prices relatively high in Fort Worth.

4. Omaha, Neb.
Average List Price: $193,260
You may be surprised to find Omaha on this top-10 list of rent-favoring cities, but Omaha's real estate has held strong at a time when the housing market is hurting most every other city. Low unemployment is a big draw, putting the rent-to-buy index at 25 in this Nebraska city.

5. Sacramento, Calif.
Average List Price: $217,894
California has been one of the states hardest hit by the bursting housing bubble. Sacramento is one city where homeownership is still a pricey option, however: with a rent-to-buy index at 23, renters can sit back and count their financial blessings each month.

6. Kansas City, Mo.
Average List Price: $201,769
Kansas City is another surprising city on this list, but with a rent-to-buy index at 23, renting is clearly the smarter way to go in this city. Though home prices vary wildly, like in many other cities listed here, home prices have actually increased slightly in Kansas City in recent months. A slightly stronger-than-average job market is attributed to this trend.

7. Portland, Ore.
Average List Price: $372,096
Portland has been a desirable place to live in America, and has held strong economically through the recession. Although rent isn't cheap either, owning a home is still an expensive proposition in this cool Oregon city: the rent-to-buy ratio is at 22 for Portland, making renting the smart way to go. According to Trulia, a price-to-rent ratio of 21 or over signals that it may be more worth your buck to rent rather than buy.

8. San Diego
Average List Price: $582,990
San Diego is another California city where it makes more sense to rent. Not only are average home prices well over half a million — tough to mortgage for the average person — the rent-to-buy index is at 21 for this ocean-side city. Renters can rejoice in San Diego.

9. San Francisco
Average List Price: $1,116,533

Got a million bucks and money to spare? Then San Francisco may be the place for you to buy a home; otherwise, renting is the better option. Rent-to-buy is indexed at 21 for the City by the Bay, so relax if you're paying a landlord in San Francisco — you're actually being wise with your money.

10. Boston
Average List Price: $726,485

Buying a home is not cheap in Bean Town: you'd better have some money or a sizeable paycheck to sign a mortgage contract. Like in most cities, renting comes at a cost too — though in Boston, your rent-to-buy index is 20.

Bottom line
We've all been taught that homeownership means you've arrived, but the recent downturn in the housing market has made everyone re-evaluate that rule. Many of these cities share a stronger-than-average job market, making them desirable places to live. Whether you live in one of these cities, elsewhere, or plan a move, do your homework before thinking buying a home is your next step. Sometimes, renting means you're financially savvy — something we all aspire to these days.

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