Careful…Don’t Get Caught in the Rental Trap!


[image: Imágenes integradas 1]There are many benefits to homeownership. One
of the top benefits is being able to protect yourself from rising rents by
locking in your housing cost for the life of your mortgage.

*Don’t Become Trapped *

Jonathan Smoke, Chief Economist at realtor.com, reported on what he calls a
“Rental Affordability Crisis.” He warns that,

“Low rental vacancies and a lack of new rental construction are pushing up
rents, and we expect that they’ll outpace home price appreciation in the
year ahead.”

In the Joint Center for Housing Studies at Harvard University’s 2016 State
of the Nation’s Housing Report, they revealed that “The number of
cost-burdened households rose to 21.3 million. Even more troubling, the
number with severe burdens (paying more than 50% of income for housing)
jumped to a record 11.4 million.” These households struggle to save for a
rainy day and pay other bills, such as food and healthcare.

*It’s Cheaper to Buy than Rent *

In Smoke’s article, he went on to say,

“Housing is central to the health and well-being of our country and our
local communities. In addition, this (rental affordability) crisis
threatens the future value of owned housing, as the burdensome level of
rents will trap more aspiring owners into a vicious financial cycle in
which they cannot save and build a solid credit record to eventually buy a
home.”

“While more than 85% of markets have burdensome rents today, it’s
perplexing that in more than 75% of the counties across the country, it is
actually cheaper to buy than rent a home. So why aren’t those unhappy
renters choosing to buy?”

Know Your Options

Perhaps you have already saved enough to buy your first home. HousingWire
reported that analysts at Nomura believe:

“It’s not that Millennials and other potential homebuyers aren’t qualified
in terms of their credit scores or in how much they have saved for their
down payment.

It’s that they think they’re not qualified or they think that they don’t
have a big enough down payment.” (emphasis added)

Many first-time homebuyers who believe that they need a large down payment
may be holding themselves back from their dream home. In many areas of the
country, a first-time home buyer can save for a 3% down payment in less
than two years. You may have already saved enough!

*Bottom Line*

Don’t get caught in the trap so many renters are currently in. If you are
ready and willing to buy a home, find out if you are able. Let’s get
together to determine if you can qualify for a mortgage now!