A10F03B49704A9555CB18D6BD506641C

Dont Get Caught In The Rental Trap

Dated: 08/29/2016

Views: 162

Don’t Get Caught in the Rental Trap! | Keeping Current Matters

There are many benefits to homeownership. One of the top ones is being able to protect yourself from rising rents and lock in your housing cost for the life of your mortgage.

Don’t Become Trapped

Jonathan Smoke, Chief Economist at realtor.com, reported on what he calls a “Rental Affordability Crisis.” He warns that,

“Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll outpace home price appreciation in the year ahead.”

In the Joint Center for Housing Studies at Harvard University's 2015 Report on Rental Housing, they reported that 49% of rental households are cost-burdened, meaning they spend more than 30% of their income on housing. These households struggle to save for a rainy day and pay other bills, such as food and healthcare.

It’s Cheaper to Buy Than Rent

In Smoke’s article, he went on to say,

“Housing is central to the health and well-being of our country and our local communities. In addition, this (rental affordability) crisis threatens the future value of owned housing, as the burdensome level of rents will trap more aspiring owners into a vicious financial cycle in which they cannot save and build a solid credit record to eventually buy a home.”

 “While more than 85% of markets have burdensome rents today, it’s perplexing that in more than 75% of the counties across the country, it is actually cheaper to buy than rent a home. So why aren’t those unhappy renters choosing to buy?”

Know Your Options

Perhaps you have already saved enough to buy your first home. HousingWire reported that analysts at Nomura believe:

"It’s not that Millennials and other potential homebuyers aren’t qualified in terms of their credit scores or in how much they have saved for their down payment.

 It’s that they think they’re not qualified or they think that they don’t have a big enough down payment.” (emphasis added)

Many first-time homebuyers who believe that they need a large down payment may be holding themselves back from their dream home. As we have reported before, in many areas of the country, a first-time home buyer can save for a 3% down payment in less than two years. You may have already saved enough!

Bottom Line

Don’t get caught in the trap so many renters are currently in. If you are ready and willing to buy a home, find out if you are able. Have a professional help you determine if you are eligible to get a mortgage.

Blog author image

Thad McIntyre

Thad McIntyre, Broker/Owner of PowerMark Properties, is a high-energy and dedicated Realtor who believes it is his duty to give back to the community on both the professional and personal level. Thad ....

Latest Blog Posts

Top 5 Reasons To Sell This Fall

5 Reasons You Should Sell This Fall!800SHARES63553271372Here are five reasons why listing your home for sale this fall makes sense.1. Demand Is StrongThe latest Buyer Traffic Report from

Read More

Hurricane Florence Creating Housing Shortage For Displaced North Carolinians

Hurricane Florence Creating Housing Shortage for Displaced North Carolinians | realtor.com® Hurricane Florence Creating Housing Shortage for Displaced North

Read More

The Difference Is More Then Just The Title

Real Estate Professionals Explained: Agent, Broker, REALTOR®By Michele Lerner | Mar 10, 2014iStockReal estate professionals go by different names. There are agents. Brokers..

Read More

Local South MS Pumpkin Patches

Looking for a local, pumpkin patch, corn maze, hayride, gourds and other Halloween activities in Mississippi?  Just select your area in the list or map below.And if you know of one I missed and

Read More