My New Blog

THERE’S NEVER BEEN A BETTER TIME TO BUY!!! RATES ARE AT RECORD LOWS, HOUSING AFFORDABILITY IS AT ITS HIGHEST LEVEL IN YEARS, THERE IS PLENTY OF INVENTORY, PRICES ARE LOW AND MANY SELLERS ARE WILLING TO BARGAIN!!!

Here are some reasons to BUY rather than rent:

–It may actually be CHEAPER to BUY than to rent. We recently ran a cost analysis for a $90,000 home in Tallahassee. Assumptions: FHA loan, 30 year fixed rate of 3.75%, $406.24 per month for principal and interest, $66.66 per month for property taxes, $62.50 per month for homeowners insurance, and $82.53 per month for mortgage insurance. The total monthly payment for the home turned out to be about $618. The rents in this particular neighborhood are around $825 per month. A person who chooses to buy a home here instead of renting could realize a savings of $207 per month!!! Or they could possibly buy a larger, nicer home with the same $825 per month payment that is currently charged for rent!!

–There may be even MORE savings involved. Many buyers would be able to take advantage of the mortgage interest deduction each year. The mortgage insurance paid may also be tax deductible! Furthermore, the new homeowner may be eligible for the rebates/credits available for those who desire to upgrade to more energy efficient appliances.

–ADDITIONALLY, Over time, the buyer may build up equity. A portion of the mortgage payment goes toward paying down the “principle” each month. This does not happen when one pays rent. Rent is basically money down the drain. Furthermore, the new owner could build up equity if the home appreciates over the years. Equity is certainly a way to create long term wealth.

–Budgeting Stability: In this case, the $618 monthly payment STAYS THE SAME for 30 years (or less if it is paid off earlier)!!! In the case of renting, there’s a good chance the rent will go up each time the rental agreement comes up for renewal. This could really add up over the years!

–Freedom: When you own the home, it’s yours! This means you can decorate, paint, improve, landscape, etc….the way you want it done (make sure you comply with the neighborhood covenants and restrictions)

–Safety and Security: An important reason families buy homes is because they want a good place to raise children and provide them with a good education. They also want a place where they can feel safe and secure and where they can build long term friendships and relationships with their fellow neighbors

–For more in depth “buy vs rent” calculations, see: _

http://www.nytimes.com/interactive/business/buy-rent-calculator.html

What are Americans saying about homeownership?  See below: