Were you among the millions of Americans in 2020 that started spending more time at home? This shift in time that most spend at home has led many to reassess their financial situations and location, especially with plummeting mortgage rates leading many to wonder – should I keep renting?
Should You Move?
Undoubtedly, buying a home is a daunting life-altering decision that leads to many lifestyle changes. It would be best to consider things such as your flexibility, stability, career growth, and family expansion. It seems like too much to consider, so you end up just renting for another year – but is that still worth it?
At What Cost?
The cost of a mortgage and the cost of rent historically were very different. Still, with high rent costs, it’s often cheaper to own your own home, even after considering property taxes, maintenance, and utility costs.
What are the costs? According to the real estate journal, The Ascent,” Mortgage payments cost less than rent: In 2019, homeowners paid $7,229 towards their mortgage, including interest. Renters paid $11,979 in rent. Overall, homeowners with a mortgage paid $4,750 less.” That is a huge difference! The difference between you going on vacation or a staycation.
But according to the data from the U.S. Census Bureau’s Consumer Expenditure Survey, in 2019, homeowners with a mortgage paid $8,609 more a year on total housing costs than renters. Total housing costs include mortgages, real estate taxes, property insurance, homeowners’ association fees, utilities, maintenance, and other items. These expenses are often billing renters have the luxury to avoid.
What are the Benefits of Renting?
With every situation, there are pros and cons including homeownership. When looking at the pros of renting, you have great flexibility, your landlord pays for significant repairs, you avoid closing costs and property taxes, and you can often move for a change of scenery.
What are the Cons of Renting?
You’re not building any equity, you cannot customize your space as much as you would like, rent prices are volatile, your landlord could sell the property, and you don’t have a sense of permanent security. If these are all issues for you, it might be best to invest your money in a home of your own.
What Should You Do?
Take into account your situation. Think about where you see yourself in a few years and develop a game plan. Speak with local experts in your real estate market to better understand how you can prepare for deciding to switch from renting to owning. There is nothing better to be than prepared!
Are you located or relocating to the DFW area? Anthoney Hanks with Beyond 404 Realty (www.Beyond404Realty.com) would love to assist you through the process and help you find your dream home and beat the cycle of signing lease after lease!
