Houston homes more affordable than renting

With low mortgage rates and relatively low home prices, a new report says that buying Houston homes may make more financial sense than renting apartments.

Using data from Moody's Analytics, Fortune reports that the rent ratio in Houston - the cost of buying a typical home compared to how much it would cost to rent - was 16.01 during the third quarter of the year, lower than many other large cities. The report says that anything below 15 favors buying, while numbers above 20 favor renting.

Houston is not alone in that category. The average ratio of the 56 cities included in the study was 14.85, while the average for the country as a whole was 10.42. In addition, analysts say that home prices may soon drop lower, shifting the market even more toward buying.

"By mid 2011 and certainly by end of 2011, buying will be superior to renting in most parts of the country," Mark Zandi, Moody's chief economist, told the publication.

The average rent in Houston rose significantly over the past year. According to data from RentJungle.com, the average monthly rent for an apartment in Houston jumped from $984 in December 2009 to nearly $1,100 last month.