Home ownership rates are the lowest they have been in the last 50 years. A large portion of Americans are still renting properties, instead of enjoying a home of their own.
Consumer Reports believes this is an issue because buyers have doubts about their ability to purchase. It’s still a long standing notion that a buyer needs 20% towards the cost of the home in order to move forward, but this isn’t true. With countless down payment assistance programs and closing cost roll-ins, a home owner could move in with as little as a few hundred to a couple thousand dollars. This is a huge difference in the time it takes to save up to make the move.With interest rates at an all time low, home ownership in today’s market is a smart investment. The money saved over a mortgage’s lifespan can result in tens of thousands of dollars, if not hundreds, when compared to what you spend in rent over the same amount of time. That’s more money in your pocket.
Don’t wait to buy when interest rates soar again. The low interest rates mean your monthly mortgage payments are at a significantly lower cost, as well. With such a heated housing marketing, rental prices are skyrocketing and statistics are consistently show that home ownership can be the equivalent to your rental rate each month, if not less. Why get stuck in a small 2 bedroom apartment if you can move into a home and pay a monthly rate that is the same? Not to mention get a 3 bedroom house with a great backyard to boot?
There is also a fear that a home can keep you “stuck” or “rooted” to one place without an easy transition out if you decide to move. Although the future of the housing market isn’t easily predictable from location to location, you can always discuss with your agent about buying a home in an area that has a strong turn-over rate when a home hits the market. The equity built up when it comes time to selling is going to be far more beneficial than if you put money into a rental and decided to move. The money from selling the property can be used to purchase a new home. With renting, there would be no additional funds to transition into a new place.
Now imagine if you were renting a home for $2000/month. If your landlord is renting to make a profit, think how much less you’d be paying on a monthly basis towards your mortgage if the home was yours. Instead of paying a landlord to profit off of you, you’d be paying a reasonable rate, and get to call the property your own while building equity. Discuss with your agent and lender the steps you need to take towards home ownership. I’d be happy to go over the options with you. Just email me at Rachel@RachelKayla.com. You might be pleasantly surprised about the type of home you can afford to move into.