Friday, May 9, 2014

Renting vs. Owning--a quick commentary

I was reviewing a contract for a gentleman purchasing an in-town townhome in the $300's; his mortgage was going to be about $1700 with Dekalb taxes and it seemed like a killer deal. While he will probably pay some monthly HOA dues, I know that there are older homes in our area (Brookhaven) that can be purchased in this price point that would NOT require HOA dues. What is the point of this commentary? He moved out of an upscale apartment complex because his monthly rent on a 2 Bedroom/2 Bath apartment with less than 1300 square feet was going to be $1625 per month! OUCH!

I am just using this example to give you pause to think about why you're renting (if you are...). If you pay rent, it goes to the landlord. If you pay your own mortgage, your asset is (hopefully!) appreciating and your balance is dropping. If you do your homework, you can find something much larger than 1300 square feet for a lower monthly cost. Yes, you may have more to upkeep but the tax benefits alone may make it worth it! Regardless, I continue to be blown away by renters who pay such high amounts when financing is so inexpensive!

With that being said, move quickly! Rates are still low; inventory is still tight. BUT rates WILL go up and there will always be houses out there--you just have to dig!