Hi all: Happy New Year!
I wanted to touch on renting vs. owning as we start 2013. Lately I've seen several renters take the plunge and buy a place of their own. It's tempting with home prices still reasonably low and interest rates at all-time lows.
For example, a friend of mine sold his house about 2 years ago. He said it was too much to take care of. They proceeded to rent and he shared with me how much he was saving. That was before his rent started increasing on the order of 10-15% each year. My friend started doing the math and realized he could own for less than what he was paying in rent.
In Bellevue, the rents are pretty steep. A one bedroom apartment will probably cost at least $1000 for something reasonably nice. If it's newer the bill may be closer to $1200 and that doesn't include all utilities. With condo's now selling for under $300,000 you could have almost the same principal and interest payment (not to include HOA dues or property taxes) if you put 20% down.
I see it all the time. One of my colleagues here on Active Rain just blogged about Gen Y'ers. Generation Y is a huge target market to buy a home. Right now a lot of Gen Y'ers up here are renting. And they're often paying upwards of $1200/month to do so. Although they may not be certain about where they're going to be in the next few years, chances are their employment situation will still be the same ( a lot of them work for Microsoft or Amazon for example). What may change is they may get married, start having a family or just come to the realization that they could have a place of their own.
For those of you who are currently renting, now may be a great time to own your own place. Again, renting vs. owning should be looked at. It used to be that the numbers were higher when you owned. For example, when we bought our house 20 years ago, our payment was almost 50% higher than our rent payment. Now, the payments are virtually the same.
Thanks for reading. I welcome your comments. If you have further questions, please: