Rising Rents: The Latest Reason Why Now is a Good Time to Buy a Home
If you’ve gone out recently to find an apartment or house to rent, it won’t come as a surprise to learn that rental rates are quickly rising and that available rental units are few and far between. It’s true. The market has swung in favor of landlords, and renters have been left with higher rents, fewer options, and a lack of move-in incentives such as a month’s rent free and other concessions.
According to a rental index by Zillow, an online home and real estate marketplace, median rents rose 3 percent nationally from January 2011 to January 2012. At the same time, the number of renters has increased due to the economic and employment challenges of the past several years.
As a result, when people go out to find a suitable rental, they are finding it difficult to locate a home that meets their needs. If they do, it is often quite costly and may not fit within their budget. It’s at this point that they think about purchasing a home instead.
“Affordable home prices and record-low mortgage rates have been the hallmark of the real estate marketplace for several years running,” said Jim Weichert, president and founder of Weichert, Realtors. “Purchasing a home now makes even more sense than ever, given the steadily increasing expense of renting and the growing probability that home prices will soon be on the upswing.”
Over the long haul, homeownership offers advantages that simply can’t be attained through renting. First, a home is much more than just a place to live. From putting down roots and creating memories to the ability to make whatever home improvements and decorating decisions you’d like, homeownership certainly has its benefits.
In the current market, buying rather than renting also makes complete sense from a financial standpoint. Rising rents have made buying a home more affordable than renting in many cases. In addition to a lower monthly payment compared to rent, homeowners who make their purchase while home prices remain low will likely benefit from home price appreciation. When real estate values increase, this can provide buyers with thousands of dollars in additional personal equity that renters simply can’t capitalize on.
Another benefit to purchasing a home is the ability to secure a fixed monthly cost. While rents typically rise a few percent each year, individuals who purchase a home with a 30-year fixed mortgage can count on having the same monthly payment over the course of the loan.
“With interest rates still at historic lows and home prices more affordable than in years past, this might be the best opportunity a renter has to realize their dream of homeownership,” added Weichert. “Those who can afford to buy now and wish to own a home down the road could cost themselves tens of thousands of dollars by continuing to rent because home prices and interest rates are expected to rise in the future.”
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About Weichert, Realtors: Since 1969, Weichert, Realtors has grown from a single office into one of the nation's leading providers of homeownership services by putting its customers first. A family of full-service real estate and financial services companies, Weichert helps customers buy and sell both residential and commercial real estate, and streamlines the delivery of mortgages and home and title insurance. Weichert leverages its customer website, www.weichert.com, one of the most visited real estate websites in the nation, to help familes and individuals realize the dream of homeownership through quick and easy access to listing information and the services of its real estate professionals nationwide. For more information, Weichert's customer service center can be reached at 1-800-USA-SOLD. Weichert franchised offices are independently owned and operated.