Buying vs Renting: is it really a tough choice?

One of the most difficult real estate dilemmas for consumers is making THE choice between renting and buying. Jed Kolko, Chief Economist  wrote in a Trulia article and supported through several market factors how buying is 45% cheaper than renting a home. It was stated that you can save hundreds of dollars a month by buying a home instead of renting – especially if you can get today’s low mortgage rates, itemize your tax deductions and plan to live there for 7 years.

 

There are several key factors that could help the still indecisive consumers to finally secure a goal.  Recently, asking home prices have rebounded and risen by about 2.3%. Running away from purchasing your own property? Hold that thought. Rents have increased more by about 4.7%.T his means that prices are lower relative to rents than they were a year ago.  

“Based on asking prices and rents during the summer of 2012, buying is now 45% cheaper than renting in the 100 largest U.S. metros, on average – that’s a savings of $771 a month. If you plan to stay in a home for 7 years, which is the average time that Americans traditionally live in a home before moving again, it is more affordable to buy than to rent in ALL of the 100 largest metros in the U.S.”

House costs aside, choosing between renting and buying is very personal. It all boils down to a consumer’s personal preference and interest. Some would prefer the security that comes along with homeownership, others would simple want freedom being the freebie of renting. It is indeed very personal to decided between buying and renting because it depends on these factors:

1. Can you qualify for a mortgage at the best rate available?
2. Which tax bracket are you in, and do you itemize your deductions?
3. How long will you stay in your home?

Selecting between these two has sparked considerable amount of debate among economists, Realtors and consumers.  At the end of the day, we have this one big question in mind: If buying is cheaper, why is everybody not doing it? Some people just don’t have the ability to save the amount of money needed for the down payment, some can’t even qualify for a mortgage.  Buying may beat renting in every major metro by a wide margin, saving consumers thousands of dollars a year, but buying still remains out of reach for many would-be homeowners.

Do you want to work with a Realtor who never fails to provide his clients about pertinent Real Estate information and market trends?  Call me, Mynor Herrera, today for expert help buying or selling in the DC, MD, & VA areas! I also specialize in Bethesda and Chevy Chase, as well as the subdivisions of Rosemary Hills, Rock Creek Forest, East Bethesda and Whitehall Condominium.