Of course you know that buying a property is a better investment than paying rent to a landlord. But did you know how much of a better deal renting is? Apparently, if you own a home for only two years, you have already made a better financial decision than someone who rents.
According to zillow.com breakeven horizon analysis, rents keep rising and mortgage interest rates are remaining rather low, so in major Metro areas, like the South Bay, the return on the investment occurs within just a few years. Why renew that lease on The Strand, when you could buy a condo there, for instance? The rent is bound to be higher than the mortgage rate. Of course, it isn’t quite that easy, as there are a few hurdles, such as a downpayment, to consider, or lifestyle choices (maybe you travel a lot and enjoy changing homes often). But even after all possible costs involved with owning a home in the South Bay (mortgage, insurance, property tax, utilities, maintenance, closing costs, etc) it is still a better financial investment to buy.
Homes are expected to appreciate, at the very minimum, 7% this year (and quite possibly much more than that), so this is an excellent time to buy. Who knows how long interest rates will remain under 5%? They’re supposed to increase slowly over the next year or so. Now many be the time to strike because that iron is h-o-t!