{"id":10809,"date":"2023-02-10T23:31:00","date_gmt":"2023-02-10T23:31:00","guid":{"rendered":"https:\/\/www.sellfor1percent.com\/?p=10809"},"modified":"2023-03-01T02:26:58","modified_gmt":"2023-03-01T02:26:58","slug":"it-is-still-more-affordable-renting-a-starter-home-than-to-purchase-one","status":"publish","type":"post","link":"https:\/\/www.sellfor1percent.com\/it-is-still-more-affordable-renting-a-starter-home-than-to-purchase-one\/","title":{"rendered":"Rent vs Own"},"content":{"rendered":"

It is still more affordable renting a starter home than to purchase one.<\/h2>\n

Owning a home is often considered the American Dream, but a new report shows that renting may actually be more affordable than buying in December of this year. According to the report, despite rent growth, renting a starter home is more affordable than buying in a majority of U.S. cities. With a combination of a strong job market and a decrease in home prices, the study found that renting has become the more affordable choice in many areas. This is great news for those looking to move but not quite ready to take the plunge into homeownership. With more options available, renters can find a more suitable home for their budget and lifestyle needs.<\/p>\n

Overview of December rental report<\/h2>\n

The rent increase rate witnessed a drastic dip to 3.4% in December 2022, which is one-fifth of what it was in the same period of the previous year. Simultaneously, the 30-year fixed mortgage rate surged to 6.36%, making renting a more cost-efficient option than buying. The yearly cost of a starter home in December 2022 was 38.1% higher than a year before, amounting to $2,657. This is more than 10 times the rent increase rate observed during the same time frame. In December 2021, when the mortgage rate was half of what it became in the later year, the cost to purchase a home in rent-favoring markets increased at roughly half the rate of rent.<\/p>\n

Benefits of renting over buying<\/h2>\n

One of the main reasons that renting is more affordable than buying is because of the benefits that come with being a renter. Most homeowners will have more costs than renters. Aside from the initial down payment, homeowners need a mortgage and insurance policies. These costs will differ depending on the home and where it is located. Other additional costs that homeowners face include property taxes, repairs, maintenance, and insurance. While homeowners need to make these additional expenses routine, renters do not incur any of these extra costs. Renter\u2019s insurance policies cover them against damage and theft, so they do not need to pay extra for home insurance. Property taxes are included in rent and are not an extra cost. Home maintenance, repairs, and maintenance are also not an issue for renters.<\/p>\n

Analysis of job market and home prices \"You<\/h2>\n

The report also looked at the job market in December to see how it affects home prices. When the job market is strong, it results in more demand for homes. This increased demand can drive up home prices. If the job market is weak, fewer people are looking for work, which means fewer people are looking to buy homes and home prices stay reasonable. The report found that the job market was very strong in December.<\/p>\n

Advantages of renting a starter home<\/h2>\n

Renting a starter home can be an great alternative to buying a more expensive home. With a large deposit and mortgage, renters may be able to afford a home with a smaller deposit and rate. Renting a starter home can also be beneficial for those who do not have the money to put down on a home. Leasing a starter home may allow renters to see if they like the lifestyle or location before they make the larger investment in a home.<\/p>\n

Cities where renting is more affordable<\/h2>\n

Another reason that renting is more affordable than buying is because it is more cost effective in many cities. The report found that renting is cheaper in 98 of the 100 largest cities in the U.S.. A recent Realtor.com study found that out of the 50 largest cities in the United States, there are five where it is more beneficial financially to purchase a home than to rent.<\/p>\n