Turning the Key on your Real Estate Dreams
RENTING MAY BE THE CURRENT REALITY
A recently released study found the number of people renting has risen over 30% in the last ten years. Partly, this is attributed to the lack of accurate information AND an abundance of poorly substantiated-inaccurate information about home ownership.
It is no surprise over 50% of current renters believe they cannot afford a home. Under the current market conditions and forecast(s), renters should really be asking themselves “How must does it REALLY cost to own a home” and more importantly “How much will it cost me if I wait?
HOME OWNERSHIP NEED TO KNOW INFO
Portland-Metro area home appreciation has been hovering at a 6.3% year-over-year high. This means a renter who purchased a home today could expect a 32% equity increase at year five; on a home purchase with sales price of $350,000-we are talking $110,250 in equity! Maybe the prospect of a 30% equity increase over five years doesn’t get you off the couch, consider some of these benefits:
- Rent is increasing at almost the same rate as home appreciation locally. The national average is not far behind at 5.3% year over year; this means $900/mo. rental will like cost $1200/mo. in 2023-with ZERO equity in your residence.
- Home-Ownership can generate long-term wealth building and is THE single most important factor in determining one’s financial security beyond their lifetime.
- A fixed monthly payment means no more worrying about (yet another) rent increase.
- Federal Income Tax deductions for home owner related expenses (Property Taxes, Mortgage Insurance, etc.) can potentially save you thousands on your return.
- Automatic Savings-your mortgage payment essentially allows you to pay yourself in the form of equity to fund your retirement or a nice vacation…. the Bahamas are nice this time of year.
- Grow Community-perhaps the most underrated benefit of home ownership is how your purchase serves to grow and enhance the communities you live and work in.
Now that you know, you may be thinking “home ownership sure does sound great, we should make a plan to that next year”. Its great you’re on-board with buying but waiting until next year could spell trouble.
KNOWING YOUR NEIGHBORHOOD
Market conditions in our area (low inventory, increasing home sales prices, rising mortgage rates) mean waiting could be the difference between having the house of dreams or becoming a professional renter. Dramatic I know, but true. Here’s what we can expect in the Portland-Metro area:
- Home Prices will continue to rise over the coming months, with little market data to support a price plateau or decline-pushing the median home price to $456,452
- Current average homebuyer can expect to save $19,000 compared with homebuyers who plan to purchase in 2019.
- Mortgage rates (lead by reduced Bond purchased by the Fed) will continue to rise and are forecasted to go over 5% by year end.
WHAT IT ALL MEANS, FOR YOU, FOR RIGHT NOW
Home prices coupled with rising mortgage rates translate to more money out of your pockets initially and thousands more over the life of your loan if you choose to wait to purchase. The journey to home ownership can be challenging, especially in our Portland-metro market. All of here at Dar & Darcie Real Estate Group know that it doesn’t have to be though. Each member of our person-centered team has extensive experience navigating the Real Estate world, guiding our clients and friends toward successful purchases-all with the end-goal of giving the right resource at the right time, exceeding expectation and providing legendary service.