Why Buying a Home Makes More Sense Than Renting Today

 

Are you wondering whether you should continue renting or buy a home this year? With rental affordability being a challenge for years, owning a home might be a better option, especially if the long-term trend of rents increasing each year continues. In this article, we'll discuss the reasons why buying a home makes more sense than renting today.

The Rental Market

Data from the Census shows that rents have been climbing pretty steadily since 1988. Even though the rental market experienced single-digit growth in March 2023, according to the latest rental report from Realtor.com, rents continue to grow today. The median asking rent was $1,732, up by $15 from last month, but it's still $354 (25.7%) higher than the same time in 2019 (pre-pandemic). With rents much higher now than they were in more normal, pre-pandemic years, owning your home may be a better option.

Owning a Home vs. Renting

In contrast to renters who face rent hikes every year, homeowners with a fixed-rate mortgage can lock in a monthly mortgage payment for the duration of their loan (typically 15-30 years). The graph below uses national data on the median rental payment from Realtor.com and median mortgage payment from the National Association of Realtors (NAR) to compare the two options.

So, if you’re looking to live somewhere where you have two or more bedrooms to accommodate your household, give you more breathing room to spread out your belongings, or dedicate the extra space to practice your hobbies, it might make sense to consider homeownership.

Building Equity

Owning your home allows you to start building your own equity, which in turn grows your net worth. As home values typically rise over time and you pay off your mortgage, you build equity. That equity can set you up for success later on because you can use it to help fuel a move to an even bigger space down the line. That’s why, according to Zonda, the top reason millennial homeowners bought their homes over the past year was to build their own equity instead of someone else’s.

Working with a Trusted Real Estate Agent

If you’re trying to decide whether to buy a home or continue renting, work with a trusted real estate agent to explore your options. A real estate agent can help you understand your local market and assist you in finding the right home that meets your needs and budget. With rents rising, it may make more sense to pursue your dream of homeownership.

Conclusion

In conclusion, owning a home makes more sense than renting it today. With rental affordability being a challenge and rents continuing to rise, owning your home allows you to lock in a monthly mortgage payment for the duration of your loan, potentially saving you money over time. Additionally, homeownership allows you to start building your own equity and growing your net worth. If you’re considering buying a home, work with a trusted real estate agent to explore your options and find the right home for you.

If you're interested in learning more about the real estate market in Prescott, Arizona, contact Michael Eastwood, CEO of West USA Realty of Prescott at 928-636-1500 or visit our website at www.westusaofprescott.com. Michael will introduce you to one of his professional real estate agents that will be happy to assist you in your search for your dream home. Each of our offices is independently owned and operated. #Prescottrealestate #Prescotthomes #Prescottland #Prescottvalleyrealestate #Prescottvalleyhomes #Prescottvalleyland #Chinovalleyrealestate #Chinovalleyhomes #Chinovalleyland #Arizonarealestate #Arizonahomes #realestate #homes #prescott #chinovalley #Prescottvalley #buyers