The advantage of renting a home over owning one is the ability to more accurately predict your monthly housing costs. When you sign a lease, you are guaranteed to pay the same amount in monthly rent for the duration of the lease. When you buy a house, your monthly mortgage the payment is guaranteed not to fluctuate (assuming you get a fixed rate loan), but since you are responsible for maintenance and repairs, your costs may fluctuate significantly.
However, when you rent a home, the money you pay each month goes towards your homeowner’s mortgage. Or, to put it another way, rent is an expense, not an investment like the home you own. So when your rent gets high, it might prompt you to stop handing over that money to the homeowner and see if you can buy your own home instead. And these days rent is an more expensive – so much so that some tenants may be tempted to become homeowners.
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Rental prices are rising
One-bedroom home rental prices rose an average of 4.9% nationwide in June, according to Zumper. Meanwhile, the rent of two-room apartments increased by 6.5%.
Part of this boom is due to tenants migrating back to larger cities after fleeing earlier during the pandemic. When the coronavirus outbreak first occurred, many people fled cities, partly for safety reasons and partly because they believed they could to work remotely, they might as well get more space for less money. But now that coronavirus-related restrictions have largely been lifted, urban life has become more attractive, so demand for living in major metro areas has increased and rental prices have followed suit.
In fact, rents in 2020 remained largely flat despite rising home sales. But rental prices have been steadily rising month after month since February, and this trend could continue throughout 2021.
This brings us back to the question – at what point is it not worth paying rent? But the answer really depends on your financial situation and comfort level.
For some people, the idea of owning a home is too stressful to be attractive, even if their finances are such that they can change it. If you are overcome with the idea of maintaining a house and paying property tax – taxes that can rise – then rent may be the best solution for you, even if you have to pay more to do so.
On the other hand, if you have enough money to buy a home and you earn enough to cover many of the costs associated with owning, then buying a home may be a smart financial decision. So the money you pay mortgage The company will help you eventually become the owner of your home every month. In addition, you will have the opportunity to take out a loan for your home, if you immediately acquire a large enough part of it. This, in turn, can give you more protection and stability.
Now you need to keep in mind that the value of houses is now greatly overpriced due to low supply and high demand. Thus, there are few good deals here. But that could change in the coming years, so if you’re tired of spending so much money on rent, it might be time to start putting together a buying plan. And if you decide that you not If you are looking to buy, you can start looking for more affordable rental options, especially if prices continue to rise in your area.