I would tell them this:
Whether you rent or buy, you will be paying a mortgage. The question is will you be paying your own mortgage or paying the mortgage of your landlord.
Plus, at the end of a year of paying rent you will see no benefit from the monies you have paid out all year. However, you will see a tax benefit at the end of the year for monies you have paid out during the year for mortgage interest and property taxes.
When renting you pay the mortgage and part, if not all of the property taxes for your landlord, and they get the tax benefits. Does that sound fair or even smart?????
Kawain Payne, Realtor
That's great that your client's husband tried to figure out all of the reasons (numbers) on why "it is not a good time to buy." Please advise him that regardless of his conclusion, wouldn't he rather have his own home than to be renting.
Right now the interest at under 3.50%, prices are down 25% approx from the peak price( at least in OC), prices started going up already,, if that does excite them to buy, maybe he should rent and you can find another buyer that is going to buy now and ready to put several good offers to get a house...
Secondly, both the RENTS and the Mortgage payment are arbitrary numbers.
Third; I use 1.25 as a factor to show reanters how much they can spend on a mortgage.
fourthly; I gave up listening to amateur's opinions, especially about statistics.
Did he factor in any tax benefits (write offs ) for interest and property taxes?.........
Did he also factor in upkeep/maintenance on a home one owns? - you don't pay for a new roof or furnace when you rent!
I think his statement is rather broad.............you'd also have to factor in what you would do with the (assuming you have it) down payent money if you didn't invest it in a home............what interest would it generate - and how might it grow as compared to investing it in a purchase?
Landlords can raise rent every year , or decide not to rent if it is an owned property (yes, I know - taxes go up, too), but moving is expensive........so that potential cost should at least be considered when looking at the whole picture.
My point is......there are too many variables, imo, to give such a cut and dry answer!!
happy new year!