To buy or not to buy (but rent) . . .that is the question!

Many baby boomers grew up and watched as their parents, for the most part, built gigantic amounts of equity in their personal residences. They too believed that home ownership was the way to go. That was until our country’s lending practices collapsed. And many of those same Boomers lost thousands upon thousands of dollars in home equity, while their children, the Gen X’ers and Millennials, noticed at the time that they needed their own places to live. But buying into home ownership may not be prudent for them.

Owning a home is, in most cases, the single biggest financial decision that many people make. It’s probably a poor decision to buy if you:

• have limited funds and can’t afford a 20% down payment or the cash to pay for the additional costs of a home;
• are uncertain about your continued employment or are living paycheck to paycheck with no ‘emergency fund’; or,
• are on a work assignment that will last two years or less or want to start a family or are planning to move.

But today, more Millennials are moving into the real estate market. About 65 percent of them were surveyed and said they plan to buy in the next twelve months. The research shows that you are better off buying if you:

• can cover the additional costs of owning, including the down payment and closing costs before buying a home;
• plan to stay in the home at least five years, so you are more likely to recoup what you paid in transaction costs and generate a return on your investment; and,
• want to reap the financial benefits of homeownership. Low interest rates make homeownership attractive because it decreases the amount borrowers pay on their loans. Mortgage rates remain around 4% or less, and these are still record lows after the 2008 financial crisis.

Essentially, with buying a home, you get to ‘stop the clock’ on a majority of your housing costs. Think about having the same rent payment for 30 years! That’s the true financial power of buying a home. And besides the tax advantages, you can build equity in your home, something that isn’t possible with a rent payment.

With thousands more Boomers retiring each day and wishing to downsize as part of their financial well-being, the housing inventories will be on the rise. That makes it an optimal time for those considering moving from rental status to home ownership something to seriously think of as a smart choice.

We are professionals at Deon Cannon Realty – we’re here to serve your real estate needs. Call us at (404) 630-2985 and we’ll work with you right now to develop a strong and sensible plan to sell your home or find the one that’s absolutely perfect for you.