Renting vs. Buying: What Does it Really Cost?

Does anyone disagree that owning real estate rather than renting makes the most sense? Or... even if you do agree, did you realize that right now the cost to rent a Median Home is DOUBLE the cost of owning?

Per Pulsenomics research:

• The percentage of income needed to afford a median priced home is almost half the percentage of income needed to afford median rent.
• Buying costs are significantly less than renting costs.
• The percentage of income needed to afford a median priced home is less than the historic norm.

 

Historically low interest rates, as well as some available down payment assistance programs are continuing to make home ownership attainable. I'd love to sit down with you and my lender partner to talk about the type of funding you qualify for and to look at the price range that makes the most sense for your finances.

It's Not A Bubble!

 Warren Buffett: There is No Housing Bubble

by The KCM Crew on May 5, 2016 in First Time Homebuyers, For Buyers, Housing Market Update, Move-Up Buyers, Pricing

 

With home prices expected to appreciate by over 5% this year, some are beginning to worry about a new housing bubble forming. Warren Buffet addressed this issue last week in an article by Fortune Magazine. He simply explained:

“I don’t see a nationwide bubble in real estate right now at all.”

Later, when questioned whether real estate and/or mortgaging could present the same challenges for the economy as they did in 2008, Buffet said:

“I don’t think we will have a repeat of that.”

 What factors are driving home prices up?
It is easily explained by the theory of supply and demand. There is a lack of housing inventory for sale while demand for that inventory is very strong. According to a recent survey of agents by the National Association of Realtors (NAR), buyer traffic was seen as either “strong” or “very strong” in 44 of the 50 states (the exceptions being: Alaska, Wyoming, North Dakota, West Virginia, Connecticut and Delaware).

Also, in NAR’s latest Pending Home Sales Report, it was revealed that the index was the highest it has been in a year.

What does the future bring?

As prices rise, more families will have increased equity in their homes which will enable them to put their home on the market. As more listings come to market, price increases should slow to more normal levels.
Anand Nallathambi, President & CEO of CoreLogic, recently addressed the issue:

“Home price gains have clearly been a driving force in building positive equity for homeowners. Longer term, we anticipate a better balance of supply and demand in many markets which will help sustain healthy & affordable home values into the future.”

Additionally Americans See home Ownership as The Best Long Term Investment:

• Real estate outranks stocks/mutual funds, gold, savings accounts/CDs, and bonds as the best long-term investment among Americans.
• Real estate is ranked as the best long-term investment among all age groups.
• Millennials rank both real estate and savings/CDs at 26% when it comes to the best long-term investment.

With continuing low interest rates and limited supply driving up prices now is a great time to buy or sell. I look forward to the opportunity to help you with either!