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San Ramon Real Estate

San Ramon homes for sale

By Mona Koussa-Listing Specialist | Broker in San Ramon, CA

To Buy a home or to Rent – that is the question

San Ramon homes-buyingVSrentingMany folks believe that buying a home is out of reach, and that renting is cheaper. But the real estate climate has changed recently, as both the buying and rental markets have heated up all around the U.S. and especially in the San Francisco Bay Area during the past few months. There have been recent studies on both rental prices and homes for sale across the U.S. in the months of June, July and August. Based on this analysis, it may be cheaper to buy than to rent a comparable property in many areas of the U.S. including the Bay Area!

These studies were based on a home-buyer being able to secure a 3.5% mortgage rate, were in the 25% tax bracket and were able to put a down payment of 20%. Any change in these factors, such as having a higher mortgage rate, a lower tax bracket and selling sooner could significantly change the outcome. With a mortgage rate of 4.5%, being in the 15% tax rate and only a 3 year window, the situation changes once again and it is 28% cheaper to rent than to buy in the Bay Area. So for people who are willing to stay put for a few years, buying may have become a better deal than renting in many areas.

There are of course many things to weigh and consider. On the buying side, historically low interest rates make buying more possible than in previous years. You need to take into account coming up with a down payment, closing costs, mortgage payments, property taxes, utilities and maintenance. Owning has the advantage of building equity, being able to paint and remodel as you please, and if you have a fixed rate mortgage, a steady and known payment for many years.

On the renting side, things to consider are – security deposit, and renters insurance and ever possible rent increases. Rents nationally have risen 4.8% as of September. However, renting has advantages of having flexibility in the event you need to relocate, and you are not responsible for repairs and maintenance.

Even if it is only a possibility – the question begs to be asked. Should you really buy a home? The best place to start would be with your preferred local bank, or credit union. Find a loan officer that you are comfortable with. They can help you crunch some numbers and go over your finances to see if buying makes sense for you. How about purchasing an investment property for rental income? Rents are outpacing home price increases in many areas. A great resource for this type of information is your San Ramon local Realtor Mona Koussa.

Comments

By Helen Oliveri,  Sun Nov 18 2012, 13:22
Great blog!

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