Owning your own home has long been part of the American dream. It's a goal most of us rightfully aspire to, and one that can often help build wealth. Indeed, 64% of Americans own a home today. If'
Is Renting Worth Your Time
Dated: May 19 2015
Hello again friends! I've taken a quick break from pounding the pavement to discuss a very pressing matter in the real estate community:
Yep, I want to take a moment to analyze those of us who prefer to waste money renting when they could be making an investment in their future. Darn morons!
That is a sentiment you will typically hear from a Realtor, or anyone who makes a living selling properties. But is it always true? Certainly there are benefits to renting a home or condo versus buying, but what are they and why don't more Realtors sell clients on the benefits? There is a win/win situation in renting for both client and agent. And I am of the opinion that renting is a great way to prepare yourself for the serious responsibility of owning a home. Many times clients are sold on the benefits of owning but totally uneducated about all of the hidden costs that a home will bring. So the question of the day is, should you rent or own?
*Your credit score is low- You will not get the best interest rate and may end up getting locked into a loan you cannot afford, or worse, spend unnecessary money! Wasting money is truly shameful and I loathe to see anyone do so. Instead, build your credit as you are renting.
*You have no savings- Many of us live check-to-check. Even if those checks are six figures, debt can quickly eat away at our income as well as, well...living life. Its no fun to sit on money when we could be making it rain at Neiman's! But I strongly advise anyone looking to purchase to have 6 months savings before buying a home. Like a 2-year-old child that never grows up, a home will always come with unexpected issues that may cost you money. Think of the hurt that comes when you have to spend your check on the roof instead of pumps and a purse. :-(
*You're going through a life transition- Divorce, new job, college graduation, etc....any big life event can come with financial challenges as well as stress. This is not the time to buy a home! Many will disagree with me on this, but buying a house is an emotional investment as well as financial. Clients should be totally invested in the process or they should wait Too often I have seen people lose hard-earned earnest money due to life events that did not pan out as expected. Of course, we can't plan everything, but we can make wise decisions and try to invest our money when we are better prepared.
Buy a home if:
*Money is no object! Hey if you're a trust fund baby or just plain rich, then you've got the dough to handle any unexpected life events plus far more than the recommended 6 months savings. Everyday problems are for us commoners!
*You have a credit score of at least 620- Most lenders suggest a minimum of 620 to get a decent interest rate.
*You have worked at your job for at least 1 year and have 3-6 months savings- Financial experts suggest having at least 3 months of your monthly salary saved. So if you bring home $3500 a month, you should have $10,500 saved.
*You are married or cohabitating- Two incomes is better than one.
To close out todays blog, I want to remind all my clients and prospects that I work with renters as well as buyers and sellers. If you are looking to lease until you feel more comfortable purchasing, please send me an email with your questions and requirements.
Have a great day!
Texas Real Estate Consumer Protection Notice