There are many benefits to homeownership. One of the top benefits is protecting yourself from rising rents, by locking in your housing cost for the life of your mortgage.
Don’t Become Trapped
A recentarticlebyApartment Listaddressed rising rents by stating:
“Rents are up 2.7% year-over-year at the national level.Year-over-year growth continues to fall between the 2.1% rate from this time last year and the 3.4% growth rate from October 2015.”
The article continues explaining that:
“Despite the seasonal slowdown,rents are still upyear-over-yearin 89 of the 100 Largest cities.”
Additionally,the Urban Instituterevealedthat,
“Over aquarter of renters, or11.1 million households, are severely cost burdened, spending at least half their income on rental housing.”
These households struggle to save for a rainy day and pay other bills, including groceries and healthcare.
It’s Cheaper to Buy Than Rent
As we have previouslymentioned, the results of the latestRent vs. Buy ReportfromTruliashows thathomeownership remains cheaper than rentingwith a traditional 30-year fixed rate mortgage in the 100 largest metro areas in the United States.
The updated numbers show that the range is an average of 6.5% less expensive in San Jose (CA), all the way up to 57% less expensive in Detroit (MI) and37.4% nationwide!
Know Your Options
Perhaps you have already saved enough to buy your first home. A nationwidesurveyof about 24,000 renters found that80% of millennial renters plan to eventually buy a house, but 72% cite affordability as their primary obstacle. Aside from affordability,one in three millennial renters have concerns about their credit scores,and another53% said that a down payment is an obstacle.
Many first-time homebuyers who believe that they need a large down payment may beholding themselves backfrom their dream homes. As we have reportedbefore, in many areas of the country, a first-time home buyer can save for a 3% down payment in less than two years. You may have already saved enough!
Don’t get caught in the trap that so many renters are currently in. If you are ready and willing to buy a home, find out if you are able. Have a professional help you determine if you are eligible for a mortgage.