Careful…Don’t Get Caught in the Rental Trap. There are many benefits to homeownership. One of the top benefits is being able to protect yourself from rising rents by locking 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 2016 State of the Nation’s Housing Report, they revealed that “The number of cost-burdened households rose to 21.3 million. Even more troubling, the number with severe burdens (paying more than 50% of income for housing) jumped to a record 11.4 million.” 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. Let’s get together to determine if you can qualify for a mortgage now!
There’s More to a Bubble Than Rising Home Prices
What truly causes a housing bubble and the inevitable crash? For the best explanation, let’s go to a person who correctly called the last housing bubble – a year before it happened. “A bubble requires both overvaluation based on fundamentals and speculation. It is...
Want to Buy a New Home? Find New Home Builds in Los Angeles
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What If I Wait Until Next Year to Buy a Home?
As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price, but instead about the ‘long-term cost’ of the home.
How Much More Equity In Your Home Over the Last Year?
Lower-priced homes have appreciated at greater rates than homes at the upper ends of the spectrum due to demand from first-time home buyers and baby boomers looking to downsize.
How Much Equity Do You Have In Your Home? You Will Be Surprised!
If you are one of the many Americans who is unsure of how much equity you have built in your home, don’t let that be the reason you fail to move on to your dream home in 2018! Let’s get together to evaluate your situation!
712,000 US Homes Moved Into Positive Equity in 2017
The average homeowner gained approximately $14,900 in equity during the past year. Compared to Q3 2016, negative equity decreased 22% from 3.2 million homes, or 6.3% of all mortgaged properties. U.S. homeowners with mortgages (roughly 63% of all homeowners) have seen their equity increase by a total of $870.6 billion since Q3 2016, an increase of 11.8%, year-over-year.
First Step To Buying A Home Is Getting Pre Approved
One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search.
The Cartier Experience
California Homes Days on Market Drops below 30 in October 2017
The National Association of REALTORS® surveyed their members for their Confidence Index.
Charts Don’t Lie About Housing Affordability
There’s a lot of discussion about the current state of housing affordability for both first-time and move-up buyers. Much of the narrative is tarnished with a negative slant.
Historically Speaking, There’s No Housing Bubble Coming Soon!
Historically Speaking, There’s No Housing Bubble! Let’s break this down. From 1975 to 1990, home values trended at standard 5% annual growth. In 1990, when the US entered into a recession, new construction prices fell.
Low Housing Inventory Results in Double Digit Price Increases
Low Housing Inventory Results in Double Digit Price Increases. If you are a first-time buyer or a seller thinking of moving up, waiting probably doesn’t make sense.
Buying A Home Or Renting, You’re Paying Someones Mortgage
As an owner, your mortgage payment is a form of ‘forced savings’. This allows you to build equity in your home. You can tap into this equity later in life if you choose. As a renter, you guarantee the landlord is the person with that equity.
Cooling Down and Home Buyers are Heating Up…Time To Sell
Each year, most homeowners wait until the spring to sell their houses because they believe that they can get a better deal during the normal spring buyer’s
1st Step To Buying a Home… Know Your Credit Score
Make sure all the information listed on your report is accurate and work to correct any mistakes.
Lack of Home Inventory Makes Now… Best Time To Sell
The inventory of homes for sale has fallen year-over-year for the last 28 months and has had an upward impact on home prices.
First Time Homebuyers Flocking to Our Down Payment Assistance Program
We’re sharing some very exciting news today for First Time Homebuyers! New California State Programs are making homeownership a reality for first time homebuyers. Owned a home in the past?
Buying A Home Costs Significantly Less Than Renting
Every market is different. Before you renew your lease again, find out if you can put your housing costs to work by buying this year!