In an ever-changing real estate market, now might be a good time to look at Buying vs. Renting in 2022. If you are coming to the end of a lease in the near future, it is probably a good time to evaluate the state of the market and make an educated decision on what works best for you, your situation, and your bank account. As most renters and first-time homebuyers are told, they should get rid of the rental and go out and purchase a home, but is this really sound advice? There have been recent reports surfacing that can make your Buying vs. Renting in 2022 decision a little clearer for you.
In a recent report by the US Department of Housing and Urban Development they looked into the current cost of renting a 3 bedroom home versus purchasing a home of similar size. It was found out that as apartment rental rates continue to rise rapidly, they will now cost about 38.5% of monthly gross income. On the flip side, the cost of owning a similar home in the same market will only set you back about 36.5% of your gross monthly wages. As you can see, the cost of renting is now starting to outpace the cost of home ownership. More data that is becoming even more prevalent in this market is that it is almost a guarantee that you will make higher rents in big cities including Chicago, New York, Los Angeles, and San Francisco just to name a few. It was also found out that in over 60% of counties studied the increase in rent is significantly out pacing the increase in wages meaning you can afford less and less by the month and year. The fact of the matter is that there is an ever decreasing inventory of rental options, thus pushing the price of available rentals higher and higher. Until there is a fundamental change in Buying vs. Renting in 2022 rent amounts will stay higher than ever.
On the flip side of our Buying vs. Renting in 2022 argument, it can be seen that even though mortgage rates have increased since the Presidential Election, the fact of the matter remains that most mortgage rates are still in the 4’s and historically these are very attractive rates. These rates might not be near the record lows we have seen in the last few years, but they are low regardless. The time might be now to become a buyer in this market as mortgage rates are believed to push past 5% this year alone. Now this isn’t a guarantee but a lot of industry “experts” believe just this.
Now there are some positive reasons for home ownership and one of the main reasons is you can deduct your mortgage interest paid on your taxes to reduce your tax liability. On a $200,000 mortgage at 4.5%, you will pay nearly $9,000 in mortgage interest your first year. This can go a long way in contributing to the reduction of your taxes owed. Another positive to home ownership is the opportunity to gain equity and wealth through the appreciation of your property. Now it isn’t a guarantee your home value will increase in the short-term, but over the long-term your home will appreciate in value. Finally, since your mortgage is recorded on your credit report, you will help your credit score by making timely monthly payments.
As you can see in the Buying vs. Renting in 2022 debate, buying a home is almost always the better option for borrowers if they intend on staying in a certain area for at least a couple years. There is no need to waste money on rent every month when you can put your money to good use in home ownership. If you are interested in purchasing a home or weighing out your options then you need to call today at 888-900-1020 and we can help you in making the right decision for you. We are here to help you any way you can and if you’d rather email us you can at firstname.lastname@example.org.