SHOULD I BUY OR SHOULD I RENT?

By
Real Estate Agent with Howard Hanna Real Estate Services

SHOULD I BUY OR SHOULD I RENT?SHOULD I BUY OR SHOULD I RENT?

That is the question, and the answer may differ greatly depending on where you live. Hindsight being 20/20, renting obviously would have made a lot of sense over the past decade in markets that would virtually plummet in value when the housing bubble burst. On the other hand some markets, such as Portland, Oregon, San Francisco and Seattle seem virtually unscathed and many of us perhaps wish that we had invested in property in these areas.

So with the looming deadline to take advantage of the tax credit, the New York Times took data from Moody'sEconomy.Com, as well as from several other sources, and compared the cost of buying and renting a home in different venues throughout the U.S.

SHOULD I BUY OR SHOULD I RENT?

They use something called the "Rent Ratio," which is the purchase price of a property divided by yearly cost of renting a similar property. Under this system a ratio above 20 indicates that renting is probably the best way to go at this time. If you are at a ratio below 20, buying begins to make more sense.

if you are curious as to what are Cleveland and Pittsburgh's rent ratios, see below (copied and pasted from one of the interactive charts in the article)

One way to figure out whether to buy or rent is to look at the rent ratio: the purchase price of a typical house divided by the annual rent of a similar house. A number above 20 means you should consider renting.  A number well below 20 makes a better case for buying.

 

Cleveland

12.6

14.9

-2.4

Oklahoma City

16.7

14.8

+2.0

Pittsburgh

11.7

11.6

+0.1

For more on whether buying or renting makes sense to you here is the link to the New York Times article:

http://www.nytimes.com/2010/04/21/business/economy/21leonhardt.html?scp=1&sq=buy%20vs%20rent&st=cseting

 FIND A HOME: http://markostrovsky.com

 

 

 

 

 

 

Posted by

Mark & Elly Ostrovsky

Howard Hanna Smythe Cramer

Cellular: 216.577.1156

EMail: EllyandMark@GMail.Com

Website: http://MarkOstrovsky.Com

 

Mark is a licensed attorney in Ohio & in Massachusetts and works with his wife Elly in residential real estate representing buyers and sellers in Cleveland, Ohio's Eastern suburbs. You can search for homes on their website:

FIND A HOME: http://markostrovsky.com/

 

 

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Mark L. Ostrovsky

Howard Hanna Real Estate Services
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