Real estate prices are rising, but buying a home still makes more financial sense than renting.

Right now, homeownership is 35% cheaper than renting on a
national level, according to a report from Trulia. Last year, it was
33% cheaper to be a homeowner than a tenant.

Home prices have risen slightly faster than rents over the last year,
the report found. But at the same time, mortgage rates remain low,
providing a nice financial advantage to buyers.

In Honolulu, it's a much closer call.

It's 16% cheaper to buy than rent in Hawaii's capital, but once
 monthly homeowner's association fees (HOAs) are taken into
account, the favor swings to tenants as it becomes 1% cheaper to
rent, according to Trulia. The median monthly HOA fee in the city is
$438, the second highest in the country behind $575 in New York City.

San Jose, Calif.; Lancaster, Penn.; Sacramento, Calif. and
San Francisco rounded out the top five markets where buying offers
the smallest edge over renting in the country.

Related: Americans are scooping up real estate bargains... overseas

Californians tend to have a smaller financial gain when it comes to
buying a home: six out of the 10 housing markets where buying has
the smallest benefit over renting are located in The Golden State, the
 report showed.

Rising home prices bring higher down payment requirements and
closing costs, which means buyers in California need to have more
cash on hand, said Ralph McLaughlin, housing economist at Trulia.
"It would take a lot longer for a homebuyer to break even from the
costs."

Related: Here's what's driving up housing prices

On the other side, buying tends to provide more financial favor to
those in the South. Sarasota, Fla., offers the biggest edge to buyers
where it's 55% cheaper to buy than rent this year, according to the
report.

But just because it's cheaper, doesn't mean people are flocking to
become homeowners. The homeownership rate fell to 63.7% in the
first quarter of 2015, according to Census.

Saving for a 20% down payment is a big obstacle, McLaughlin, said.
"Even though we are a few years out of the recession, it can still take
quite a while to save up for a down payment, especially when rents
are high."

Low mortgage rates are a key factor in the calculations, and if rates
start to rise, some markets could see a shift toward renting, according
 to McLaughlin, particularly San Jose, Lancaster and Honolulu.

"If interest rates make a significant increase, then it will make those
market even more attractive to renters because it adds costs to home
buying process," he said.

The report analyzed the estimated median home value and rent in
the 100 biggest housing markets in March and assumed a 3.87%
30-year fixed-rate mortgage with a 20% down payment, itemizing tax
deductions at the 25% bracket, and the buyer remaining in the home
for seven years.

Here's where the gap between buying and renting is narrow: