Let's say a tenant living in a 2-bedroom in Rockville received a lease renewal notice. This is the moment when they start to wonder whether to pay more rent or consider buying a condo. Following the calculations for this home reveals some changes between September and October.

First, let's clarify the reference point. The data is based on information confirmed in early November, and I couldn't find the total sales figures for the entire month of October. Therefore, I will consider sales based on the most recent 30-day figures up to October 10.

According to Zumper's October data, the median rent in Rockville is $2,562. This is a 1.8% increase from the previous month and is nearly the same as this time last year.

Breaking it down by the number of bedrooms shows some differences. A 1-bedroom is $2,062, which is a 1% increase over the month, while a 2-bedroom remains unchanged at $2,500. A 3-bedroom is $3,295, reflecting a 1% rise.

Compared to a year ago, the differences are more pronounced. Studios have decreased by 8%, and 2-bedrooms are down 4%, while 1-bedrooms and 3-bedrooms have each increased by 3%. This provides a basis for negotiation for 2-bedroom tenants.

However, relying solely on one number can be misleading. RentCafe's update on October 30 shows the average rent at $2,361, which is 1.62% lower than last year's $2,399. Since the sample sizes differ, it's best to use this for trend observation.

Let's compare with surrounding cities. According to Zumper, Gaithersburg is at $2,600, North Bethesda at $2,519, Silver Spring at $2,041, and Bethesda at $3,625. Rockville is in the middle range among these areas.

Now, looking back at the lease renewal notice, it's crucial to note that the Montgomery County rent increase cap does not apply to rental housing within the city. The county's cap of 5.2% for 2026 does not serve as a basis here.

Instead, there is a voluntary guideline set by the city. Since April 14 of this year, it has been 2.59%, and it is not mandatory. For a rent of $2,500, the recommended increase would be up to $64.75 per month.

The lack of enforceability is a disadvantage, but having an official number to reference during negotiations is beneficial. If the proposed increase is significantly higher than this, I would ask for justification.

There are also new rules coming into effect next year. Rockville amended its rental ordinance in July, which will take effect on January 1, 2027. Key changes include limits on fees, enhanced cost disclosures, and a ban on algorithmic pricing.

If you have a lease that extends into next year, I recommend reviewing the fee section once more. Tenant informational sessions will be held online on November 9 and December 10, and in person at the Rockville Memorial Library on December 2.

So, what about buying? According to data compiled by the Fox Homes Team from Bright MLS, 99 properties were sold in Rockville from September 11 to October 10. The median sale price was $621,000, which is 4.5% lower than the same period last year when it was $649,950.

What stands out more is the speed. The median time on the market increased from 11 days a year ago to 28 days now. The ratio of sale price to listing price also dropped from 100.71% to 97.57%.

It's premature to say that home prices have dropped. When looking at a 90-day period, the price is $625,000, reflecting only a 0.3% decrease, and over 12 months, it's $655,000, which is actually a 1.6% increase. The 30-day figures can fluctuate depending on which homes sold.

The differences by type are even greater. Based on the last 12 months, single-family homes sold for $720,000 in 8 days, while townhouses sold for $711,895 in 11 days. Condos took 27 days to sell at $395,000, and transactions have decreased by 20%.

The inventory is moving in the same direction. As of October 11, there were a total of 299 listings, which is about 2.5 months of inventory, but for condos alone, there were 141 listings, equating to 4.5 months of inventory.

The most significant change between September and October has been in interest rates. The average 30-year fixed rate from Freddie Mac was 6.71% on September 3, but it rose to 7.40% on October 8 and 15. By October 29, it slightly decreased to 7.24%, compared to 6.17% at the same time last year.

Let's factor this into the tenant's calculations. If purchasing a $395,000 condo with a 20% down payment on a 30-year fixed mortgage, the loan amount would be $316,000. Based on my calculations, the monthly principal and interest would be $2,041 at 6.71% and $2,154 at 7.24%.

In less than two months, that's an increase of $113 per month. Additionally, property taxes, condo fees, and insurance are not included, so it shouldn't be directly compared to the $2,500 rent.

If we raise the price to a $621,000 home, the burden increases further. Under the same conditions, the monthly principal and interest would rise from $3,209 to $3,386, an increase of $177.

There are advantages as well. In a market where homes take longer to sell, there is room to negotiate on repair costs or closing fees. This is especially true for condos.

However, there are clear disadvantages. With high interest rates, even if home prices drop slightly, the monthly payment burden does not decrease correspondingly. For condos, one must also consider the increase in management fees and the time it takes to resell.

If I were that tenant, I would start with lease renewal negotiations this year. The 2-bedroom rent is lower than a year ago, and the city's recommended increase is 2.59%, so I have leverage. In the meantime, I would save for a down payment while keeping an eye on condo prices.

Of course, if I plan to stay long-term and can afford the monthly payments, my decision would differ. Now is also a good time to choose, as competition is less fierce. Since the figures vary by reporting agency and time period, please recalculate based on actual listing conditions before signing a contract.

Once the total figures for October are released, it will clarify whether this 30-day data was temporary. Until then, try not to be too swayed by a single month's numbers.