Rent soars, making buying a home a more affordable choice.
While most people believe that renting is a better option for your wallet, over these last couple of months this has not been the case.
Rent has soared across the U. S. and renters should expect to be dishing out twice as much of their incomes on a temporary home, rather than a permanent pad.
Although renting an apartment, condo, or house seems to be the way to go, especially if staying in one place for long periods of time is not your forte, it could be costing you twice as much. According to Zillow, in the third quarter of 2014, renters were expected to dish out 30 percent of their incomes on rent. Homebuyers spent just 15 percent of their incomes on their mortgage payment.
In years passed, rent was usually considered to be the more affordable option, especially for people living in a big city. Now, people could buy a home and expect to save a lot more than those who choose to rent. In terms of affordability, home buying could be much more feasible.
You may be asking yourself: Is buying more affordable even if you buy a home in areas such as Los Angeles and Boston? The answer is, yes! Renting used to be the way to go while living in high price metropolitan areas, but not anymore. After the real estate market crash, rent has increased, but the costs associated with buying a home have dropped tremendously, making buying a home the more affordable option (even in the major city hot spots).
And millennials, we are talking to you! Affordability is the main thing on a young buyer’s mind. Through 2015 market predictions, many young buyers are expected to choose to buy a home, because rent is becoming less affordable. If you are considering purchasing a house in the near future, but aren’t sure if you want to invest right now – you may want to reconsider. Renting may affect your budget to the point that you could have trouble saving for a down payment when you are ready to buy a home.
For those who are looking to make a fiscally-focused decision on whether or not to rent, the time to buy may be now. And, what better way to start then to speak to one of our mortgage specialists? Click here so that we can help you finance the home of your dreams.