Clients often ask if now is a good time to buy a home, but it’s rare for anyone to ask if it’s a good time to rent. While we’d make the argument that the benefits of home ownership almost always outweigh those of renting, current market trends sharply underscore that today is most definitely not a prime time to rent.
Runaway Rents
The Census Bureau recently released their 2017 first quarter median rent numbers. Here’s an insightful graph showing rent increases from 1988 until today:
Clearly rent rates have steadily climbed and are showing no signs of losing steam. If you’re faced with making the decision of whether or not you should renew your lease, you might be pleasantly surprised at your ability to buy a home of your own instead. It’s a discovery more and more people weighing the buy or rent decision are making. With interest rates remaining low, buying now is a smart decision for many.
A Trend Toward Ownership
If you’re a potential homeowner, you’ll find yourself in good company. According to the latest report from the US Census Bureau, more Americans chose purchasing a home over signing a lease to rent in the first quarter of 2017. This marks the first time since 2006 that the number of new homeowner households outpaced the number of new renter households. Of the 1.22 million new households that were formed in the first quarter, 854,000 were new-owner households making the jump straight to homeownership rather than renting first, making the homeownership rate among new households 70%!
Bottom Line
When you weigh the long term benefits of home ownership- tax advantages, planting roots in a community, and stabilized housing costs- against the pitfalls of one of the worst renter’s markets Southern California has experienced, the path to ownership offers a clear set of financial gains. If you’re ready and willing to buy, let’s meet to explore the path to your property ownership options today!
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