The Parkland Parrot Real Estate Team is often asked by our clients if it is better to rent or buy. Our answer is that it depends on the individual situation. There are certainly times when renting is a better option than owning. If a person is being relocated to the area for a temporary job, then renting for the short-term is a much better option. Or, if an individual is very unfamiliar with an area and wants to acclimated, then it is better to rent before you commit to purchasing in an unknown area.
But, in most cases, renting does not make sense over buying a home in today’s market. Here is why:
Real estate is based on supply and demand. In today’s unsettling economic market, many homeowners are being forced out of their homes due to foreclosures. Also, many on-the-fence buyers are scared to pull the trigger on a home purchase. In the past year, the supply of rental properties has significantly decreased causing an increase in rental fees. According to the Calculated Risk Blog, vacancy rates are back t0 2008 levels, which is not far from the 2006 rate which was around 5.7%. As a result, as vacancy rates decrease, rents will certainly increase which will also eventually support housing prices in the neat future. Please view the below chart to see the apartment vacancy rate in the United States:
Bottom Line: Is now the ideal time to rent? Our Parkland Real Estate Team strongly believes that NOW is the best time to buy as prices are at record lows, and housing costs will increase! NOW will also be the best time to lock in a 30-year fixed mortgage at historically record low interest rates. As a result, you can set up your housing expenses for the next three decades. On the other hand, rental prices will continue to increase for years to come making owning a home a better investment for now and into the future.
We know the numbers, we analyze the market, our clients make better decisions. If you are interested in buying a home in Parkland or South Florida and are looking for experienced local Realtors, please do not hesitate to contact the Squawk at 954-609-0591 or send us a message here.
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