As rent prices are going up; the principal-and-interest mortgage payments are going down. CoreLogic's national rent skyrocketed 36 percent from December 2005 to December of 2018. Whereas, typical mortgage payment fell 4 percent over the same time frame.
Researchers believe mortgage rates made the most significant difference in the change. In December 2005, 30-year fixed-rate mortgages averaged 6.3 percent. While in 2018, the 30-year fixed-rates were at 4.6 percent. This also happened with the home prices being incredibly different. In 2005 the average cost of a home was $190,000, and in 2018 the average price was $220,305. However, the typical monthly mortgage payment was lower because of mortgage rates being lowered; the average price in 2005 was $941, and in 2018 the average price was $904.
Another thing CoreLogic also looked at was metro areas and found 7 posted rent increases of 27 percent to 61 percent between December of 2005 and 2018. This mirrored a decrease in the typical mortgage payments which ranged from 3 percent to 27 percent.
If lower pricing is not enough to convince you to buy a home instead of renting than take a look at these other advantages:
-Home owning will help build equity and credit
-No landlord to answer to
-More stability and less likely to be kicked out
-Possible tax benefits
-You can improve or upgrade home to your liking
-Property tax bills
Owning a home gives you the ability to have your place with your personality put into it. For those who own animals, you'd also be saving money because there is no pet fee for a home you own.
However, there is some downside to owning a home, but it's just about maintaining your home and making sure the bills are paid. The biggest downfall to owning a home is the possibility of the houses value declining (this is only an issue if you don't plan on living there for a while).
Renting, however, has the scarier disadvantages:
-The landlord can raise the rent
-The landlord can sell the property
-Might force you to move multiple times
-Doesn't build equity
-No tax benefits
There is also the possibility of having a bad landlord and if you live in an apartment, noisy neighbors.
The most significant advantage, however, would be to use SETCO for your home closing needs. We have partnered up with Qualia, which is a cloud-based title, escrow, and closing platform that helps create a more safe, reliable, and trusting closing environment. Get an instant estimate right now through Qualia by visiting our homepage!