5 Reason Buying a Home Beats Renting was written for the Colorado Springs Market but it really applies to our local market (Orange County, Riverside County, CA) as well. The break down of renting vs owning your home is beautifully illustraded and should be read by anyone that is still renting.
The Colorado Springs housing market and across the country has taken a beating over the last several years. There’s no doubt about that or the impact social media has played in spreading the negative news surrounding the economy and battered housing market.
Thanks to Facebook and Twitter, what used to be the local news station is now a viral sensation when video highlighting their shocking foreclosure numbers hit their social networks. Within minutes the video makes its way into every corner of the country. No longer is our news just about the local Colorado Springs market; it’s about the housing crash and the associated horror stories across America.
Social media has stimulated the debate: Is there still such a thing as the “American dream” and is now really a good time to buy?
Should I Buy a Home Now?
According to the National Association of Realtors, 8 out of 10 people still say now is the time to buy a home. This means that despite the barrage of bad economic news, Americans are still optimistic about the housing market.
So the question has to be asked - with interest rates still at record lows and an abundance of homes on the market, why aren’t buyers knocking down our doors? (No pun intended of course) As real estate and mortgage professionals, it’s our job to help 1st Time Home buyers understand the benefits of buying a home vs. renting.
Why Buying a Home Just Makes Sense
1. Great Rates + Low Prices = A GREAT Deal for You!
With interest rates hovering around 4.5%, the cost to buy a home in Colorado Springs is cheaper than it’s ever been. Let’s look at how the monthly costs break down (approximately) for an assessment of how renting stacks up against purchasing a 3 bedroom, 2 bath home:
Renting Buying Rent: $1,395 Principal, Interest, PMI: $900 Renters Insurance: $25 Homeowners Insurance: $80 Property Taxes: $0 Property Taxes: $125 Total: $1420 Total: $1105
The unfortunate news is that if inflation picks up, you won't see mortgage rates this low again.
2. The Freedom to Be YOU
When you rent a home, you typically don’t have the luxury to make changes or improvements to the home. If you are able to update the house, you will be required to ask the owner for permission. So living in a home that looks and feels like you is out of the question.
It makes no sense to spend thousands of dollars painting, putting in carpet, tile or window coverings when you won’t be the one benefiting. When you own a home you now have the freedom to make improvements and turn it into the dream home you have been waiting for.
The best part is that all of the equity built in that home is now yours!
3. Consistent Monthly Housing Payments
We are currently seeing an escalation in rent cost throughout Colorado Springs and you can expect that to continue.When you rent a home, you have no control over the increase to that monthly payment unless you are willing to pick up and move each time it happens.
When you own a home, you have the option to choose a low fixed interest rate which offers the same monthly payment year after year. You are able to live without the worry of a rent increase or the possibility that you can no longer afford the home you are living in.
Even if you choose an adjustable rate mortgage, your payment will remain the same for a fixed period of time. Typically this ranges between 1 and 10 years.
Think about what the cost to rent a home will be in 10 years. I can’t imagine how many price increases you would see over that time and the tens of thousands of dollars you will put in someone else’s pocket.
Does it make sense to continue throwing that money away each month?
4. Forces You to Save Money
Buying a home is like putting your money in a piggy bank. You automatically begin saving money from the moment you start making payments.
Here’s how it works: As you make your payment, a portion of that goes toward your principal balance. It may start out small at the beginning, but becomes a significant amount over the life of your loan.
Your house is also going to appreciate over time. This appreciation is known as equity and turns into cash when you sell or refinance that home. Owning a home is still one of the best financial investments you can make.
5. More Room to Grow
Are you tired of cranky kids because they can’t go outdoors to play or restless dogs that wish they had a backyard to run in?
Buying a home of your own gives you more room to enjoy life both indoors and outdoors. Plus, if you are in an apartment now, think of the money you will save in laundry alone!
When you rent an apartment, the idea behind their design is how to fit as many people into a small cramped space as possible. A much distant second would be their concern over your comfort or lifestyle.
As first time home buyers, moving to your new home will give you the freedom and space to live your life to its fullest. In fact, you might be so excited about all the room you have, you might have to buy more stuff to fill it!
Contact our team at 719.387.1368 and find out how you can start on the path to home ownership today!
5 Reasons Buying a Home Beats Renting was written by Rebekah Radice.
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T: 719.387.1368 | Email: firstname.lastname@example.org | Website: http://rebekahradice.com |CO & NMLS Licensee: LMB100010938 & 288596 | Benchmark Mortgage dba Ark-La-Tek Financial Services, LLC | 12 E. Kiowa |Colorado Springs, CO 80903
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