Some Highlights:

• Historically, the choice between renting or buying a home has been a tough decision.
• Looking at the percentage of income needed to rent a median-priced home today (29.2%) vs. the percentage needed to buy a median-priced home (15.8%), the choice becomes obvious.
• Every market is different. Before you renew your lease again, find out if you can put your housing costs to work by buying this year!

by The KCM Crew

Access Teri’s one-stop Orlando FL home search website.

Teri Isner is the team leader of Orlando Avenue Top Team and has been a Realtor for over 24 years. Teri has distinguished herself as a leader in the Orlando FL real estate market. Teri assists buyers looking for Orlando FL real estate for sale and aggressively markets Orlando FL homes for sale.

You deserve professional real estate service! You obtain the best results with Teri Isner plus you benefit from her marketing skills, experience and ability to network with other REALTORS®. Your job gets done pleasantly and efficiently.  You are able to make important decisions easily with fast, accurate information from Teri. The Orlando Avenue Top Team handles the details and follow-up that are important to the success of your transaction.

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The results of the latest Rent vs. Buy Report from Trulia show that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage in the 100 largest metro areas in the United States.

The updated numbers actually show that the range is an average of 17.4% less expensive in Honolulu (HI), all the way up to 53.2% less expensive in Miami & West Palm Beach (FL), and 37.7% nationwide!

Other interesting findings in the report include:

• Interest rates have remained low, and even though home prices have appreciated around the country, they haven’t greatly outpaced rental appreciation.
• Home prices would have to appreciate by a range of over 23% in Honolulu (HI), up to over 45% in Ventura County (CA), to reach the tipping point of renting being less expensive than buying.
• Nationally, rates would have to reach 9.1%, a 145% increase over today’s average of 3.7%, for renting to be cheaper than buying. Rates haven’t been that high since January of 1995, according to Freddie Mac.

Bottom Line

Buying a home makes sense socially and financially. If you are one of the many renters out there who would like to evaluate your ability to buy this year, meet with a local real estate professional who can help you find your dream home.

Article courtesy of Keeping Current Matters.

Access Teri’s one-stop Orlando FL home search website.

Teri Isner is the team leader of Orlando Avenue Top Team and has been a Realtor for over 24 years. Teri has distinguished herself as a leader in the Orlando FL real estate market. Teri assists buyers looking for Orlando FL real estate for sale and aggressively markets Orlando FL homes for sale.

You deserve professional real estate service! You obtain the best results with Teri Isner plus you benefit from her marketing skills, experience and ability to network with other REALTORS®. Your job gets done pleasantly and efficiently.  You are able to make important decisions easily with fast, accurate information from Teri. The Orlando Avenue Top Team handles the details and follow-up that are important to the success of your transaction.

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There are some people that have not purchased a home because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you are living with your parents rent free, you are paying a mortgage – either your mortgage or your landlord’s. As The Joint Center for Housing Studies at Harvard University explains:

“Households must consume housing whether they own or rent. Not even accounting for more favorable tax treatment of owning, homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord plus a rate of return.   That’s yet another reason owning often does—as Americans intuit—end up making more financial sense than renting.”

Christina Boyle, a Senior Vice President, Head of Single-Family Sales & Relationship Management at Freddie Mac, explains another benefit of securing a mortgage vs. paying rent:

“With a 30-year fixed rate mortgage, you’ll have the certainty & stability of knowing what your mortgage payment will be for the next 30 years – unlike rents which will continue to rise over the next three decades.”

As an owner, your mortgage payment is a form of ‘forced savings’ that allows you to have equity in your home that you can tap into later in life. As a renter, you guarantee your landlord is the person with that equity. The graph below shows the widening gap in net worth between a homeowner and a renter:

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, owning might make more sense than renting with home values and interest rates projected to climb.

Access Teri’s one-stop Orlando FL home search website.

Teri Isner is the team leader of Orlando Avenue Top Team and has been a Realtor for over 24 years. Teri has distinguished herself as a leader in the Orlando FL real estate market. Teri assists buyers looking for Orlando FL real estate for sale and aggressively markets Orlando FL homes for sale.

You deserve professional real estate service! You obtain the best results with Teri Isner plus you benefit from her marketing skills, experience and ability to network with other REALTORS®. Your job gets done pleasantly and efficiently. You are able to make important decisions easily with fast, accurate information from Teri. The Orlando Avenue Top Team handles the details and follow-up that are important to the success of your transaction.

Get Orlando Daily News delivered to your inbox! Subscribe here!

According to the latest Beracha, Hardin & Johnson Buy vs. Rent (BH&J) Index homeownership is a better way to produce greater wealth, on average, than renting. The BH&J Index is a quarterly report that attempts to answer the question:

Is it better to rent or buy a home in today’s housing market?

The index examines that entire US housing market and then isolates 23 major markets for comparison. The researchers at use a “’horse race’ comparison between an individual that is buying a home and an individual that rents a similar quality home and reinvests all monies otherwise invested in homeownership.” Ken Johnson, Real Estate Economist & Professor at Florida Atlantic University, and one of the index’s authors states: “The U.S. as a whole is still in clear buy territory. The cities of Cincinnati, Chicago, Cleveland, and New York City are deep into buy territory.” Miami and Portland had been inching closer toward renting being the better option but have “pulled back from the edge.” Johnson goes on to say, “that’s a good sign for home pricing as it suggests prices are going to level off in these metro areas.”

Bottom Line

Buying a home makes sense socially and financially. Rents are predicted to increase substantially in the next year, so lock in your housing cost with a mortgage payment now.

Access Teri’s one-stop Orlando FL home search website.

Teri Isner is the team leader of Orlando Avenue Top Team and has been a Realtor for over 24 years. Teri has distinguished herself as a leader in the Orlando FL real estate market. Teri assists buyers looking for Orlando FL real estate for sale and aggressively markets Orlando FL homes for sale.

You deserve professional real estate service! You obtain the best results with Teri Isner plus you benefit from her marketing skills, experience and ability to network with other REALTORS®. Your job gets done pleasantly and efficiently. You are able to make important decisions easily with fast, accurate information from Teri. The Orlando Avenue Top Team handles the details and follow-up that are important to the success of your transaction.

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Buying is 38% cheaper than renting. That statement reflects Trulia’s Winter Rent vs. Buy Report. “Although the gap between renting and buying is narrowing across the U.S., homeownership is still 38% cheaper than renting.”

When evaluating buying a home vs. renting you need to understand the local math. Although the national average is 38% cheaper for buying vs. renting, the range across the country is from 5% cheaper to 66% cheaper.

The Trulia report concludes that there is nowhere in the US that buying a home is not cheaper than renting. However, the percentage of difference does vary widely. That is because there are variables that depend on local circumstances such as:

• Local home values
• Local rents
• Mortgage interest rates
• Rates of value appreciation

If you really want to understand the detailed numbers go to the full report.

You can also go to Trulia’s Rent vs. Buy Calculator that allows you to plug in your local variables.

Borrower’s credit score is another factor you need to take into account when evaluating your situation. Mortgage interest rates are perhaps the most important variable in the buy vs. rent calculation. One of the factors that affects interest rates the most is the borrower’s credit score. The lower your credit score the higher the interest rate you will pay.

The monthly payment on a $200,000 loan for 30 years increases by $60.27 for every 0.5% added to the interest rate. That means the decision about whether to borrower using a variable interest rate (such as an ARM) or a fixed interest rate over the life of the loan is very important.

The Trulia report also evaluates the “tipping point” for interest rates that will cause renting to be cheaper than buying. For the national average that leads to the 38% figure the mortgage interest rate would have to rise to over 10%. However, you should look at local factors involved for a home using the Rent vs. Buy Calculator.

You can follow this link for the current Forbes.com interest rate forecast. You can also find current mortgage interest rates at bankrate.com.

Current indicators are that both home prices and interest rates are going to rise steadily over the next five years. That is good news for potential buyers, and means now is a good time to buy. However, if you’re hoping to become a homeowner anytime soon use these tools to do some research.

Information courtesy of Orlando Realtor Teri Isner.

Access Teri’s one-stop Orlando FL home search website.

Teri Isner is the team leader of Orlando Avenue Top Team and has been a Realtor for over 24 years. Teri has distinguished herself as a leader in the Orlando FL real estate market. Teri assists buyers looking for Orlando FL real estate for sale and aggressively markets Orlando FL homes for sale.

You deserve professional real estate service! You obtain the best results with Teri Isner plus you benefit from her marketing skills, experience and ability to network with other REALTORS®. Your job gets done pleasantly and efficiently. You are able to make important decisions easily with fast, accurate information from Teri. The Orlando Avenue Top Team handles the details and follow-up that are important to the success of your transaction.

Get Orlando Daily News delivered to your inbox! Subscribe here!