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Renting vs Buying a Home

We get a lot of questions about whether, in this current economic and real estate climate, it’s better to rent or buy a home. What we have to look at is whether rent prices are higher or lower than a monthly mortgage. Now a few years ago when the real estate market was at its peak, rents were usually lower than mortgage payments.

Times have changed as has the real estate market. Due to demand for rentals based on homeowners short selling their homes (or even walking away and allowing foreclosure to take place, something we advise against!), coupled with lower housing prices and historically low mortgage rates, in most cases it makes sense to own a home that will almost always have a lower monthly mortgage payment as opposed to renting a similar property.

A few things to consider if you’re thinking about buying a home:

Purchase cost:
Even with “No Money Down” loans, buyers usually will still need to come up with some funds to close their home loan. Other factors include taxes, insurance, and maintenance of a home.
Lost opportunity cost:
This is something to consider if, for those who have choices in how they will invest their money, whether or not it will make more of a return in another investment opportunity aside from real estate.
How long are you planning on staying in a home that you purchase:
This is important, as return on a real estate investment is best the longer you own the property.

If you’re considering whether or not it is time to purchase a home, we’d love to provide you with a no obligation, no cost analysis of your situation to determine whether it’s the right time to buy. Go to http://bringingyouhomescv.com or call us direct at 661-290-3802. We’re more than happy to answer any questions you may have.

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