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3 Reasons Renting is Better than Buying

09 Jan 2018

Posted by Joseph Coupal

HHHunt ApartmentsThe housing crash permanently altered the perception of homeownership. Renting is now, if not vogue, a socially acceptable alternative to homeownership. And here are a few reasons why renting can be even better than owning a home.

Liquidity

First of all, renters have a greater liquidity than homeowners, a financial flexibility that cannot be understated in today’s economy. Homes are a highly illiquid form of investment, given that they cannot be sold quickly. That’s not to say buyers don’t exist, but they’re not necessarily easy to come by either. A house cannot be quickly converted into cash without the possibility of losing a large percentage of its value. Renters avoid this problem entirely.

And unlike homeowners, renters invest no equity in their property, so they’re able to put that money elsewhere. This is important to note because homes are not appreciating like they used to. Homes are not the safe bet that people have always relied on. If people are interested in seeing large investment returns, they’re better off putting their money elsewhere.

Flexibility

Renting also affords a mobility that homeownership cannot. Instead of being bogged down by the process of selling a home, renters can move as soon as the lease expires. Then they’re free to move wherever they like, trying out new neighborhoods or sticking around what they know. And they don’t have to rehab their unit prior to moving. They don’t have to engage in costly updates to make their unit more desirable. Escrow might as well be a word in a foreign language.

Additionally, renters don’t have to take the time to fix anything — that’s the landlord’s job. Instead of replacing a busted washer and dryer, many renters can just request a fix from the property manager. It’s incredibly easy, saving both time and money.

Lifestyle

Many rental properties offer numerous facilities and benefits that homes do not. Apartment communities offer amenities that cater to life’s essentials — and then some. Some of these amenities are in-unit, like upgraded kitchens, energy efficient appliances, smart control HVAC systems and designated storage spaces. Plus, there are community amenities that homeowners lack. These include gyms, swimming pool and internet cafe. Renters save an incredible sum by avoiding membership fees.

The data doesn’t lie: According to The State of the Nation’s Housing 2017, the number of renter households rose by 600,000 from 2015 to 2016, marking 12 consecutive years of growth. Conversely, during the same 12-year period, the national homeownership rate fell. And not only did this figure fall, it decreased every single year. The stigma behind renting has all but vanished, demonstrating clear advantages with which homeownership cannot compete.

For more information on apartments, contact HHHunt.

#HowYouLive

forbes.com

For Some Renters it Pays to Renew

12 Jul 2017

Posted by Joseph Coupal

HHHunt Apartment
  • Renters who renewed their leases for the last five or more years rather than move to a new apartment saved roughly $329 each month, according to Zillow.
  • The annual market rate rent jumped 5.6% from 2014 to 2015, while for renewed leases, the rent increase was just 3.6%. More than half of renters planning to move in the next three years are considering another rental.
  • Renters in markets experiencing faster rent growth can gain from staying put.

Dive Insight:

A continued rise in rent costs is a significant trend because more potential homeowners are waiting to buy. The combination of low inventory and high prices has forced many renters to keep renting as they save up for an often-hefty down payment. While millennials aspire to own a home, they are hindered by student loan debt, a tight credit market and the high cost of homes today.

The growing prevalence of single-family, built-for-rent homes could further stall prospective homebuyers’ plans to own as these properties provide many of the same features as a detached, owned home.

While there is a noticeable gap in rent increases for those who renew their leases over a multi-year period versus those who move each year, the overall increase in rent prices has slowed, according to the most recent Beracha, Hardin & Johnson Buy vs. Rent Index. This combination of reasonable rent prices, availability of rentals and a shortage of for-sale housing inventory, along with steep prices for those properties, could cause more households to rent for longer.

Homeowners are also finding that it now takes longer to recover the cost of buying a home compared to renting, according to Zillow, as home price growth moderates in some markets, causing equity to build slower.

For more information on renting, contact HHHunt.

Source: Construction Dive

Ways to Decide To Rent or Buy

22 Jun 2016

Posted by Joseph Coupal

Whenever the subject of renting comes up, there will inevitably be people who caution against it. Renting gets a bad reputation for being a short-term solution with no immediate permanent assets.

However, the idea that buying a house is the best long-term investment isn’t necessarily true anymore. In fact, studies show that real estate only outpaces inflation by a very small margin over time and might not be the best place to invest your money (if that’s what you’re going for).

The real problem with renting vs. buying arguments is that there are so many details to consider when weighing the pros and cons of each. While there’s no simple answer, there are a few things you can look at to determine whether renting or buying is the best choice for you.

Look at how much rent is rising in your area.

In many instances, people choose to rent because buying a house costs much more money up front. Problems arise when rent continues to rise year-over-year, though, while a mortgage will stay fixed. However, taxes can go up regularly which will change your monthly mortgage payment. However, there are factors that make renting much more viable if you live in a city with relatively stable rent. In these cases, you can often negotiate longer leases with fixed monthly rent prices and search around for better deals.

Decide how much maintenance you can afford.

While tax credit does offset some of the costs of owning a home, you should also be aware that maintenance is a huge cost that can come with owning a home. Being able to choose your own paint colors and rip out ugly flooring is one of the reasons most people dream about owning their own place, but homeowners are also on the hook if a plumbing issue damages those freshly-painted walls and expensive new floors.

Make sure you’re not forking over all your income to buy a home and leaving your savings account empty. If you don’t have at least six months of expenses saved up, consider renting and investing some extra money while you work towards owning a home.

Check your timeline.

Most people don’t stay in one house their entire lives, so it’s crucial to consider the costs of selling before you even buy a place. Most financial advisors suggest that you should plan on staying put for at least five years or you will most likely end up losing money.

For more information on apartments, contact HHHunt.

#HowYouLive
KLS.com

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