The Ultimate question.... Buy or Rent?
So there is a time in every persons life were this daunting question comes up. Do I continue to rent a home or do I take a giant leap of faith and purchase a home?
A couple of factors greatly contribute to the answer, and for each person the answer is different.
- How much would my rent be?
- How much would a mortgage payment be?
- Do I even qualify for a mortgage?
- If I qualify what kind of down payment would I need?
These are just some of the questions that people have to consider when making their decision.
We will use Conway, AR for an example and we can answer the questions.
The typical starter home for rent in Conway, AR is a 3 bedroom, 2 bathroom, and 1250 to 1500 Square feet. Typical rent for this size home varies but a good snap shot would $1000.00-1250.00 per month.
The same size home home to purchase would be around $120,000 to $150,000.
A typical mortgage on a $135,000 house with taxes and insurance included would run a home owner around $900.00 to $1000.00 per month. (Credit Score determines interest rate which affects payment)
There are many great local lenders that would be more than willing to see if you qualify for a mortgage. just give us a call at 501-230-6082 or email us at email@example.com and we can give you the contact information of a few of them.
That would be a great question for the lenders and they would be able to give you a more detailed answer. There are several loan packages available currently. The two most popular are Rural Development Loan Program (100% Financing) and FHA Loan (3.5% down payment). Then of course you have the Conventional loan programs (5% down payment). Credit scores play a large part in the interest rates and for what loan programs you can apply for.
Advantages of Renting:
- If it breaks the landlord will fix the issue.
- short term commitment, a typical lease is 12 months.
- Depending on place you are renting yard care maybe included for a monthly fee.
Disadvantage of Renting:
- No tax benefits to renting.
- You are paying the landlords mortgage for them.
- you are not earning equity monthly on a rental property.
- You are not allowed to alter the property (paint, flooring, etc).
Advantages of Buying a home:
- Your monthly payment would typically be less than renting a home of the same size.
- You get tax deductions for home ownership.
- You don't have to ask permission to paint or change flooring.
- You own it.
Disadvantages to Buying a home:
- It is not a short term commitment.
We have a great property management division at Sandstone Real Estate Group headed up by Jonathan Dobbins. If you think renting is a better fit for you then we highly recommend calling him to see what rental units we have available.
If you are more inclined to make a purchase instead of renting, please give us a call at 501-230-6082 or email us at firstname.lastname@example.org. We look forward to helping in any way possible.
Roussel Team Realtors
Sandstone Real Estate Group