Been on the fence about jumping into the real estate market? So have many other millennial's and homeownership hit a low of 36% in 2014 among this generation. But why have they been so timid about jumping on board? Perhaps it's the shaky stock market that seems to be doing very well one day and dropping hundreds of points the next. Maybe it's the risk of commitment? Fewer and fewer people are jumping into serious commitments these days and homeownership is definitely one of those major commitments. Whatever the reason, now may actually be one of the best times. Here are three major reasons why millennial's should wait too much longer before jumping on the real estate bandwagon.
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#1. Prices are extremely affordable.
Now, this may not be in every market across the country and some markets are way above peak levels, far above where they were even during the housing market bubble of 2006 and 2007. However, many markets are still quite affordable and because rates are low, you can buy a larger house for less money than had you purchased one when the rates were high. A 30 year mortgage rate is still one of the lowest ever but they are increasing. Millennial shouldn't be surprised to find rates over 5% in just two years.
#2. Buying is cheaper than renting.
In most markets across the US buying is anywhere from 15% to 30% cheaper than renting. This means that to rent the same type of property you would be spending up to 30% more per month than had you purchased it and were spending that money on a mortgage. This includes all housing costs including homeowners association fees, taxes, property insurance and maintenance. And remember, when you're paying a mortgage, you're putting money back into your own home, building equity that you can cash in on at a later time. This also depends on the supply and demand. Those investors that were snatching up properties just five years ago are now cashing in on many renters forced to rent due to lack of inventory.
Read more: 5 Keys to Know Before Buying Your First Home
#3. You're not moving for some time.
This is always been a deciding factor whether a person should buy or rent. If you're planning on staying in the home for at least five years, buying is an excellent option. If you love the area, the school district, the location and the ease of commute, you might consider buying, saving equity and then if the time comes to move, you'll have built up enough equity at the time to put a substantial down payment on your next home. If you don't think you'll be in the area for longer than three years, renting might be a better alternative.
Of course there are always things to consider if you're on the fence about buying. You will have upkeep, maintenance, and it's important to understand all costs involved before jumping in. For more information on buying a home, first-time buyers or how to get started visit my website or contact me today. - VisionRealty.com
As a certified Realtor® for the top-rated Columbus Realty Firm - Vision Realty, with 32 years of dedicated real estate experience, I can help buyers, sellers, investors, short sale sellers and more find, sell or invest in the right property, at the right price, at the right time. Contact me anytime for updates and information on the Columbus OH Real Estate market.