Is it cheaper to RENT or BUY a home?
It can take an astute mathematician to crunch the numbers of "Is it cheaper to rent or buy?" when taking into account interest rates, appreciation, and related homeownership costs.
Thankfully, smart people have done this math for us and have created this very helpful graph.
[Chart courtesy of Land Title Guarantee Company based on data here: https://www.realtor.com/mortgage/tools/rent-or-buy-calculator/. Shared with permission.]
Is it cheaper to rent or buy? See for yourself. At our current rate of market appreciation, if you're paying $1,500/mo, buying becomes cheaper than renting after only two years. (Monthly mortgage or rent payments of $2,000-$4,000 work to the buyer's advantage by the end of year three.)
For sellers, there are two things you need to know.
1. There is NOT a bad time to sell in the current Denver market. At the time of writing this post (fall 2017), there is only good, better, and best, but NOT bad. We're in the slowest time of the year right now, and homes are still selling 4x-7x faster than homes sold in the previous peak of the market in 2007.
2. If you're considering selling, TALK TO US NOW! The whoa-slow-down-that-looks-super-complicated graph below shows the pattern of the market over the past three years, and we expect this pattern to repeat itself in 2018.
[Chart courtesy of Land Title Guarantee Company. Shared with permission.]
The green line indicates the number of homes for sale. The yellow and red lines show the demand for those homes.
In the spring, the demand exceeds the supply (i.e. there are more buyers than sellers), so prices climb rapidly. From late summer to winter, supply exceeds demand, so prices stay about the same or slightly drop.
WE'RE ALREADY BEGINNING CONVERSATIONS WITH PEOPLE PLANNING TO SELL 6 MONTHS FROM NOW.
Don't procrastinate. Avoid the panic and rush of last minute major decisions.
Request your free consultation now to determine what your best plan of action is with your home.
We're here to help. There are no stupid questions. Let us know how we can help you!
Josh & The RAGE Team
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This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for tax, legal, or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.
