Buying Is Now 33.1% Cheaper Than Renting in the US
The results of the latest Rent vs. Buy Report from Trulia show that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage in the 100 largest metro areas in the United States.
The updated numbers actually show that the range is an average of 3.5% less expensive in San Jose (CA), all the way up to 50.1% less expensive in Baton Rouge (LA), and 33.1% nationwide!
Other interesting findings in the report include:
- Interest rates have remained low and, even though home prices have appreciated around the country, they haven’t greatly outpaced rental appreciation.
- With rents & home values moving in tandem, shifts in the ‘rent vs. buy’ decision are largely driven by changes in mortgage interest rates.
- Nationally, rates would have to reach 9.1%, a 128% increase over today’s average of 4.0%, for renting to be cheaper than buying. Rates haven’t been that high since January of 1995, according to Freddie Mac.
Buying a home makes sense socially and financially. If you are one of the many renters out there who would like to evaluate your ability to buy this year, let’s get together to find your dream home.
Looking at the big picture, the rules of supply and demand will give us the clearest idea of what is to come. Buyer demand is high, inventory is low driving home prices higher.
Homeowners now have a large amount of equity in their homes and may decide to sell rather than wait for the bank to foreclose.
Home sales continue to amaze industry experts, and there are plenty of buyers in the pipeline ready to enter the market.
From pre-approval to making your best offer, here are three tips to make sure you can act quickly and confidently when you find the perfect home.
Know your options! Call your mortgage provider.
Let’s connect today to get your house on the market at this optimal time to sell.