Should you rent or buy? This is a question that most of us face at some point.

 

Anyone currently looking to rent a House, Townhouse or Condo in the Cary area today will be lucky to find anything for under $700 per month with the average rental property in Cary currently being listed at over $1600 per month. Things don’t get much cheaper with apartments as many 1 bedroom units run at $650+ per month and 3 bedroom units at $1100 + per month.

 

The truth is that there are no hard and fast answers, many will tell you that renting is “dead money” and you would be crazy not to own and that although there may be fluctuations, real estate only goes up in value.

 

However, it does not always make sense to buy, renting could be the better option. When my wife and I first moved to the Cary area from England we rented an apartment for over 2 years as we pursued our new careers, built our credit (as I did not previously exist in the US credit rating system) and got to know the area.  Then when the time was right for us, we purchased a house.

 

So, when is the right time?  One of the big determining factors is financial, here is a web based rent vs. buy calculator, that will help you play with different scenarios.  Buying a house takes money, not only in the purchase but also in maintenance, taxes and other expenses so getting your own financial house in order is critical before you make that step to buying your own home.

  Another factor is how long you think you will be living in the same location. If you think this will be for less than 2 years then renting may be a better option.  Even in todays market there are still many benefits to buying a home, the main one being investment potential. Home ownership builds wealth by increasing equity by paying down the mortgage and through appreciation - the rise in the homes value over time.  The Federal Reserve’s Survey of Consumer Finances has consistently found a huge gap between the wealth pile up by homeowners and that accumulated by renters.Other benefits of owning your own homeinclude mortgage interest tax deductions, property tax deductions, capital gain exclusion,  pride of ownership and inflation protection/predictable payments - if you lock in your rate you will know what your monthy payments will be for the next 5, 10 or 20+ years where rent will continue to rise over the same time period. 

At the end of the day, information is key. A renter that is considering buying a home needs to have a game plan, understand their own financial situation and the cost of home ownership, then choose a Realtor to work with who knows their area and can help you find a home in this changing real estate market.

 

If you have transitioned from renting to owning in the Cary area please comment with any tips or advise that were of use to you.

 

Mark Lawrence

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