Did you miss our radio show that aired live last Sunday, November 24, 2013 at 10:30 AM? No worries, if you missed it or want to listen again you can watch the podcast available now on ITunes and coming soon to www.charlottemarketradio.com.
Our last episode discussed one common dilemma most homeowners face and this is renting versus buying, which is better? According to Mecktimes and Trulia’s statistics, buying a house is better than renting one; specifically if you live within Charlotte, North Carolina. During the summer of 2013, buying a home was actually cheaper by 44 percent than renting. The difference between both narrowed since summer of 2012, where it was 54 percent cheaper to buy than to rent.
Furthermore, by Trulia’s estimate, the mortgage rate tipping point, when renting becomes cheaper than buying, is at 13.3 percent for Charlotte. And according to Bankrate.com, the current mortgage rates are 4.12 to 4.62.
The benefits of owning a home were also presented, here are a few:
- When paying money towards the principal on your loan each month, you increase the percentage of your home that you own.
- Mortgage payments remain the same with a fixed rate loan. Rent costs, however, inevitably go up.
- You gain from the appreciation on your home. The whole house appreciates, not just your down payment.
On the other hand, the downside of renting was also discussed.
- In renting, you do not accumulate equity. You are essentially giving away your money each month. Why are you buying your landlords home?
- The landlord benefits from the appreciation values, not the tenant.
- The landlord benefits from your work and improvements on a house or apartment that you rent.
For first time homebuyers, there are special lending programs you can rely on like HUD homes. If you live in Charlotte, be sure to get a certificate first from attending an 8-hour Home Buyer workshop and get up to $7,500 which you can use as down payment and closing costs.
For those who have been hurt by the economic downturn by a short sale or foreclosure; good news because you can now purchase a house in much less time because of a recent change in the rules. FHA has loosened their guidelines allowing borrowers to get a home loan in as little as 12 months after a foreclosure or short sale.
Last but not the least, the 3 most common myths of buying versus renting were also discussed, which are as follows:
Myth #1 A bigger down payment is always better
You don’t need to put 20% as down payment..
Myth # 2 You get more for your money in the suburbs
Savings from lower-cost housing often are wiped out by unexpectedly high transportation costs.
Myth #3: Renters escape property taxes
Renters don’t pay property taxes directly; any business minded landlord factors in all of their carrying costs into their rental rates so it’s like they’re paying the taxes of the landlord.
For more information and elaboration on the topics discussed, listen to our podcast.
On the next episode of our radio show, we will discuss how to get your home ready for the market. If you have any questions or clarifications, please don’t hesitate to call us at 704-440-0007. We’re always happy to answer your queries.