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More Baby Boomers are Renting

16 Nov 2017

Posted by Joseph Coupal

HHHunt ApartmentsGone are the days when the rental market was filled with recent college grads who were looking to move in with a few friends in order to save money to one day buy a house.

The demographic of those seeking apartments has changed in a big way.

In fact, the new renters are the parents of the millennial generation.

“We looked at the renter population between 2009 and 2015 by age group, education level and family type. And we found the fastest-growing segment of the country's rental population were those age 55 and older. They increased by 28 percent nationally. The highly-educated renter, holding a bachelor degree or higher, increased by 23 percent nationally," said a spokesperson for Rent Cafe.

You are seeing older couples, empty-nesters, highly educated, who are choosing the renting lifestyle for various reasons.

2.5 MILLION STRONG

On a national level, about 2.5 million households of people age 55 or older joined the renter cohort nationwide between 2009 and 2015, compared to a mere half million new renters under 34, according to the study.

We are seeing more seniors looking to rent as the prices of the traditional empty nest downsizing options -- condos and co-ops on one level -- continue to go up.

They [baby boomers] are looking for low-maintenance, high-convenience, and no stairs to walk. They get all of this, and no unexpected repair and maintenance expenses in rental buildings, with the additional benefit, a fixed monthly housing expense.

NOT ENOUGH RETIREMENT SAVINGS

Many Realtors say part of the issue is many baby boomers failed to sock away enough money for retirement.

The sad reality for baby boomers is the fact that a large segment of this generation has failed to put aside enough money for retirement in their 401(k) or retirement plans.

Unfortunately, social security benefits are not enough to make ends meet. As a result, some are forced to sell their homes in order to lower their living expenses. As the findings note, this is one way that retirees can simplify their lifestyles and expenses.

For more information on renting apartments, contact HHHunt.

#HowYouLive

silive.com

When Renting is the Right Decision

06 Nov 2017

Posted by Joseph Coupal

HHHunt ApartmentsConventional wisdom suggests buying a home makes more financial sense than renting. In many cases, this is true. However, renting is sometimes a smarter approach than buying.

As with any financial decision, all of the options and circumstances need to be weighed before jumping in. Making a major purchase requires doing some homework. The following are some reasons why renting can be more beneficial than buying.

Youth

The typical first-time home buyer is 31-years-old. People who are younger than that and uncertain about their futures should not feel pressured into buying simply because it is presumed to be the “adult” thing to do. Renting and feeling your financial way, which can include seeing how a job pans out or where one’s budget lies after paying off debts, might make more financial sense than buying.

High price-to-rent ratio

Buying may seem like a wise idea, but it could be causing people to spend more than necessary, particularly if they check the price-to-rent ratio and find homes in their area are not fairly priced.

Figuring a P/R ratio includes finding two similar houses (or condos or apartments) where one is for sale and the other is for rent. Divide the sale price of the first place by the annual rent for the second. The end result is the P/R ratio.

The higher the P/R ratio, the more sense it makes to rent instead of buy.

Home prices continue to rise

Some people find themselves being priced out of certain neighborhoods or cities. While the typical worker’s earnings increased a meager 0.3 percent during the study period, median house prices were up by 17 percent. Wages have not recovered from the Great Recession as quickly as home prices have, and some people may need to rent out of necessity.

A market shortage makes it harder to find an affordable home. The number of homes available for sale in many areas of the country has fallen below the number that is required for the market to be in balance. Therefore, even when a home becomes available, demand drives the price up to where it may not be affordable or fiscally smart to purchase. In such instances, renting may be the best option.

One doesn’t meet the buying criteria

Individuals should not buy a home based on market conditions or pressure from others. Instead, they should buy when they’re financially ready. This means being out of debt; having between three and six months of expenses in an emergency fund; enough cash for a 10 to 20 percent down payment on a fixed mortgage; and when their mortgage payment will be no more than 25 percent of their monthly take-home pay.

Renting can be a smart move in many instances. Only when individuals are financially and emotionally ready to buy should they begin searching for their first homes.

For more information on apartments, contact HHHunt.

#HowYouLive

villagenews.com

Renting an Apartment Has Many Advantages

24 Oct 2017

Posted by Joseph Coupal

HHHunt Apartments - Buy or RentAdvantages Of Renting

While there are clearly benefits to buying a home, renting has some advantages that you should consider before you make a final decision to become a homeowner as a single parent.

Investment risk

While real estate is generally considered a good investment, there's no guaranteed profit. The value of your home depends on forces that you can’t control, like the job market, the supply of houses and zoning changes.

You can improve the worth of your home by taking care of it, and can increase your equity by paying down the mortgage balance, but if your home drops in value, you could lose money when you need to sell.

Maintenance

Renters benefit from the fact that the landlord is responsible for maintenance and repairs – both the cost and the hassle of hiring someone to take care of the property.

Buyers sometimes forget to budget for the inevitable cost of home repairs.

Flexibility to relocate

One of the biggest reasons to continue renting is the possibility that you may want to change jobs or transfer to a new location.

Or you may want to escape some awful new neighbors or decide you hate your commute.

Renters can more easily end a lease, while buyers need to sell their home or rent it out and become landlords themselves.

Fewer financial obligations

Of course, renters must pay rent, renter’s insurance and sometimes utility bills.

However, homeowners pay mortgage principal and interest, property taxes, homeowner’s insurance and utilities. There may also be homeowner’s association (HOA) fees and mortgage insurance.

In addition, single parent homeowners should budget about one percent of the property value each year for maintenance and repairs, or purchase a home warranty.

For more information on apartments, contact HHHunt.

#HowYouLive

Excerpts - themortgagereports.com

Considering Renting or Buying

10 Oct 2017

Posted by Joseph Coupal

HHHunt Apartments

Most of us grew up hearing adults tell us what a great investment owning a home is.

But is it really always a good choice to buy a home? Are there any conditions when it is better to rent instead of purchasing a home? The answer is yes, owning your own home can be a solid investment, but it is also true that purchasing a home is not always the best plan. When deciding whether to buy or rent, you should consider multiple factors, because there are pros and cons to both buying and renting.

There are several financial benefits to renting temporarily or even long-term. If you rent, you will never have to pay property taxes. You should purchase renter’s insurance, but you won’t have to buy homeowner’s insurance, which is more expensive. Also, while owning a home can be financially beneficial, it isn’t necessarily the best way to invest your money. You could choose to invest in stocks, and you might end up with more money than you would by simply owning a home for a long time.

If you do buy a home, you will have to take care of it if you want to keep your investment. You would also most likely have to hire someone to fix issues like the roof, plumbing, or other repairs. If you consider yourself handy at fixing things, then you also could choose to make the necessary changes yourself. However, if you already have a busy life or simply prefer not to tinker with household issues on your time off, then you will have to pay someone.

These are things that potential homebuyers often don’t consider: All of these issues cost money if you own your own home. If you prefer to have someone else handle most problems, escape yard care, and also avoid additional costs, you may consider long-term renting.

For more information on apartments, contact HHHunt.

#HowYouLive

wallstcheatsheet.com

Renting is a Good Option for Many

03 Oct 2017

Posted by Joseph Coupal

HHHunt ApartmentsGenerations of Americans have considered owning their own home a key aspect of achieving the American Dream. But the lingering aftermath of the housing crash has caused many people to rethink that belief. Many are opting to rent an apartment rather than buy.

Long gone are the days when Americans assumed home ownership could only have a positive impact on their finances, and that renting was equivalent to throwing money away.

Like any debate, the question of renting versus buying has pros and cons on both sides. Buying a house creates the potential to build equity and provides a sense of stability, while renting affords a level of mobility. In many areas of the country, the gap between lease costs and monthly mortgage payments has narrowed, making both options equally affordable.

While the decision to rent or buy will depend on your personal circumstances, when you're considering the question some facts are universal. Among them: What impact might your credit have on your decision to buy or rent, and what impact will either option have on your credit score? How long do you plan on staying in this particular location, do you have job security and how much do you like home repairs and yard-work?

When you're evaluating whether buying a home or continuing to rent makes sense for you, consider all the facts as well as your lifestyle.

For information on renting contact HHHunt.

#HowYouLive

NorthNewJersey.com

Why Renting is Better Than Owning

25 Sep 2017

Posted by Joseph Coupal

HHHunt Apartments

Many people have said “What do you think of the idea of me buying a home?” Here is some advice.

There are many reasons to not buy a home:

Financial:

Cash Gone. You have to write a big fat check for a down payment. “But its an investment,” you might say. Historically this isn’t true. Housing returned 0.4% per year from 1890 to 2004. And that’s just housing prices. It forgets all the other stuff mentioned below. Suffice to say, when you write that check, you’re never going to see that money again. Because even when you sell the house later you’re just going to take that money and put it into another down payment. So if you buy a $400,000 home, just say goodbye to $100,000 that you worked hard for.

Closing costs. This is about another 2-3% out the window. Lawyers, title insurance, moving costs, antidepressant medicine. It adds up. 2-3%.

Maintenance. No matter what, you’re going to fix things. Lots of things. In the lifespan of your house, everything is going to break. Thrice. Get down on your hands and knees and fix it! And then open up your checkbook again. Spend some more money. When you rent and the dishwasher doesn’t work, call the landlord and he fixes it.

Taxes. There’s this myth that you can deduct mortgage payment interest from your taxes. Whatever. That’s a microscopic dot on your tax returns. What’s worse is the taxes you pay. So your kids can get a great education. Whatever.

You’re trapped. Let’s spell out very clearly why the myth of homeownership became religion in the United States. It’s because corporations didn’t want their employees to have many job choices. So they encouraged them to own homes. So they can’t move away and get new jobs. Job salaries are a function of supply and demand. If you can’t move, then your supply of jobs is low. You can’t argue the reverse, since new adults are always competing with you.

Ugly. Saying “my house is an investment” forgets the fact that a house has all the qualities of the ugliest type of investment:

Illiquidity. You can’t cash out whenever you want.

High leverage. You have to borrow a lot of money in most cases.

No diversification. For most people, a house is by far the largest part of their portfolio and greatly exceeds the 10% of net worth that any other investment should be.

Personal reasons to not own a house.

Trapped. Some people like to have roots. But others like things to change every once in a while. You can pick up and move anytime when you rent.

Rent. People will argue that the price of the mortgage, maintenance taxes, etc is all baked into the price of rent. Sometimes this is true. But usually not.

Psychology. Look at your personal reasons for wanting to own. Do you feel like you can’t accomplish something in life until you own a house? Do you feel like it’s part of getting married and “Settling down”, i.e. creating a nest for your future children? For you, is it a part of becoming an adult. Is this what your parents taught you? Examine the real reasons you want to own and make sure they are coming from a good spot in your heart.

Your time. Do you really want to spend all that time working on your house? Is this where your time is best spent towards creating a happy and fulfilled life for yourself?

Choices. When you rent you always have the choice to leave. To live wherever in the world you want whenever you want. Adventure becomes a possibility even if you never take advantage of it.

Stress. For some, owning a home equals stress.

Cash is king. If you like cash in the bank and like having access to it, rent. Owning means it is all tied up in one illiquid investment.

For more information on renting apartments, contact HHHunt.

Source: jamesaltucher.com

A House is an Expense Not an Investment

18 Sep 2017

Posted by Joseph Coupal

HHHunt ApartmentsThere has been a lot of conversation lately debating the value of housing as an investment. A case can be made that treating a house as an investment is the biggest mistake most people make in personal finance. That's why many people own houses they can't afford, and don't have sufficient financial assets to support themselves in retirement.

First and foremost, housing is a living expense. We have to pay some amount of money every month to live somewhere. Now, we will either pay it through renting a place or buying a place. But the amount spent on housing is a lifestyle expense. It's just like transportation. You have basic transportation costs to get around in life. You can either lease or buy a car, but the car is an expense, not an investment. And buying a $100,000 Mercedes isn't an investment; it's a lifestyle choice because you could have driven a used Kia or even taken the bus.

You might be thinking, "well a house is a lot different than a car, and that's not a valid comparison." Ah, but it is, because both assets are depreciating.

The house itself, the physical structure that you built or bought, is a depreciating asset, just like a car. It will age and fall apart over time unless you are constantly pumping money into it for maintenance. And the costs of maintenance and repair are expenses. Even when you pay off the mortgage, you will have costs to maintain, insure, and pay taxes on the value of that home. So the bigger the physical house, the more it will cost you to keep it. That's a fact.

By now you might be thinking, "but houses do go up in value, so how do you explain that?" Yes, they can as long as the region where you live is growing economically and you continue to maintain the home. If your region is growing, housing over the long term will roughly increase in price along with wage growth.

  • By the way, if housing prices grew faster than wages over the long term, then no one could eventually afford a house as the annual mortgage payments would be more than the average worker's total annual salary.

In most parts of the country, that means a return from housing just slightly above inflation. That's not bad, but when you offset those price increases with the costs of maintaining the home, you usually end up putting more money into the house than you get out of it. That's not much of an investment.

OK, if houses depreciate and cost money to keep up, how come some people have made lots of money on their houses? Here's the answer: what really goes up in value is the land, not the house you built. Some people get lucky with houses and end up owning homes in parts of the country that experience big increases in land values. That's why the three most important things in real estate are location, location, location. It's the land that has the potential long term value, not the physical house.

Bottom line. Houses are primarily a lifestyle expense. Necessary, but still an expense. Buy only what you can comfortably afford, and leave plenty of room in the budget to invest in financial assets that can support you in retirement.

For more information on apartments, contact HHHunt.

#HowYouLive

CBS News

Millennials Are Renting For Different Reasons

12 Sep 2017

Posted by Joseph Coupal

HHHunt ApartmentsMillennials aren't buying homes at the same rate as previous generations, and homeownership rates for those under 35 have steadily declined since the early 2000s.

One reason for this shift: Young people today have different priorities.

According to a recent survey, 47 percent of young people between the ages of 18 and 34 would rather spend their money on traveling than buying a house. This holds true to an opinion millennial consumers have expressed for years: Experiences matter more than things.

A 2014 Eventbrite poll found that 78 percent of millennials would choose to spend money on a desirable event over a desirable purchase and 55 percent said that they're spending more on experiences than they ever have.

Millennials aren't spending our money on cars, TVs and watches. They are renting scooters and touring Vietnam, rocking out at music festivals, or hiking Machu Picchu.

Young people also prioritize small luxuries, such as restaurant meals, daily Starbucks runs and avocado toast. Forty-seven percent of respondents ages 18 to 34 said they'd prefer to rent over buy if it meant they could still afford such indulgences.

But although finances alone aren't the only thing holding young people back from home ownership, cost remains a major factor in whether or not they choose to buy.

Home prices keep rising while wages have remained largely flat. So, recent data from Apartment List shows, although 80 percent of millennials would like to purchase real estate at some point, very few young people are in a good position to buy.

While an indulgent vacation may set a millennial back a few thousand dollars, the cost of owning a house is vastly higher. A 20 percent down payment on a $200,000 home would cost $40,000 alone, before closing costs, maintenance and other the other expensive elements of home ownership even come into play.

For more information on apartments, contact HHHunt.

#HowYouLive

cnbc.com

Millennials Should Rent And Not Buy Their Home

06 Sep 2017

Posted by Joseph Coupal

HHHunt ApartmentsHere is some insight into the home ownership issues Millennials face.

When one pulls out the calculator, and projects home price appreciation - home purchase makes sense. Home buying is a forced savings plan as part of the mortgage payments increase home equity. This works IF you have the coins to plop down the down payment - closing costs - and the home price appreciation occurs as expected. And going into retirement, social security goes much farther if you do not rent and own your home outright - especially if you have owned that home for a period of time and have relatively low tax rate.

Home ownership is a noose around your neck if one is required to move. Homes are close the hardest asset to sell. For Millennials, many are faced with a changing job market. How many times in their lifetime will Millennials change jobs because of robotics? And according to LinkedIn "Millennials are job-hopping more than previous generations" - 4 companies in 10 years after graduation. Is it smart to make a long term commitment (say home ownership) if your job changes requires moving to a new location?

Additionally, what goes UNSAID is the hidden costs of home ownership. From gobankingrates.com:

Buying a home is expensive - in fact, the average American home costs more than $360,000, according to the U.S. Census Bureau. The cost of owning a home doesn’t end with your mortgage loan, however; you must add maintenance into your budget, which might cost you an additional $1,204 a month, or $14,448 annually. Those monthly costs can add up quickly - it might help you decide if buying a home is the right financial move.

For more information on renting apartments, contact HHHunt.

nasdaq.com

Renting a Home is at a 50-Year High

29 Aug 2017

Posted by Joseph Coupal

Abberly West Ashley, Charleston, SCDue to lingering effects of the 2008 housing crisis, renting has become a widely popular option for those hoping to combine an independent lifestyle with affordability. In fact, more Americans are actually renting a home than at any point since at least 1965.

While the number of U.S. households jumped 7.6 million from 2006 to 2016, the amount of homes owned rather than rented actually remained flat. In turn, the amount of households choosing to rent rose from 31.2 percent in 2006 to 36.6 percent in 2016. This nearly reaches the all-time high set in 1965 of exactly 37 percent.

While renting has historically been more common for nonwhites and young adults, the trend has been increasing all across the board. More whites and middle aged adults are renting than ever before, arguably due to financial reasons more than anything. Many Americans — both renters and owners alike — believe it’s currently a seller’s market and therefore not a great time to make a purchase. The recent nationwide spike in median home values paired with rising competition doesn’t help justify buying a home either.

While rental rates have increased among many groups, young adults — younger than 35— continue to rent more than any other age group. Millennials often want to leave their childhood home, but they don’t necessarily have the means to buy their own place just yet. In fact, many of them don’t want to at all — recent trends such as the decline of the McMansion and the surge of millennials living in cities indicate Generation Y finds other factors more important than square footage.

For more information on renting apartments, contact HHHunt.

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chicagoagentmagazine.com


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