Renting A Home Vs. Buying A Home in Frederick Md
Buying a home is not for everyone; sometimes it’s a good idea for a particular time, sometimes it’s a good idea to wait, and sometimes people shouldn’t buy. Here are some facts and stats to help you decide when it’s a right time to buy or rent. Renting a home vs. buying a home in Frederick Md is a personal choice, based on a lot of variables. Sometimes it involves more than just numbers.
Home values have were declining since the Frederick Real Estate market peaked in 2006 until the summer of 2012. The first 2 years of decline in home prices were in the double digits, but the next 2 years have slowed to less than a 5% decline. Then we saw the leveling off of home values here in Frederick County, and now we’re experiencing increases increases in most neighborhoods.
Even though prices have risen over 10% in the last 2 years, homeownership is still affordable with today’s low interest rates. Interest rates have hovered at historic lows, between 4 % to 4.5%.
Trulia’s Rent Vs. Buy study in March reports that in 100 metropolitan areas, it is cheaper to buy than to rent… an average of 38% cheaper.
But some would-be buyers are still on the fence, due to the insecurity of the economy.
Have you saved money by putting off your home purchase?
The cost of buying is still low. Interest rates are the major factor in the cost of a home. Look how the changing interest rate effects the monthly mortgage on $100,000:
As the demand for rentals increases, the cost of renting will increase. This is a picture of how rents have risen over the past 5 years…you can see how the prediction is for more increase.
Buying a home now makes sense. You can lock in a mortgage payment before home prices and mortgage rates rise as experts expect they will. If you rent, your housing expense will only continue to increase.
General Criteria For A Home Purchase
- If your employment is secure and your income is enough for the price range in your area.
- If you plan to stay in the home for 5-7 years.
- If your credit score is good.
- If you have some money saved for a downpayment. An FHA loan requires 3.5% down.
- Other qualifying factors may apply, depending on your loan products available.
Give us a call for a list of preferred lenders. There are programs out there for first-time buyers, you may qualify for a grant to help with a down-payment. A lender will go over the details of the cost of buying a home and help you determine how much home you can afford.
The Highland Group
Frederick, Md 21704