This last year has highlighted the importance of one’s home and community. As a result, renters are making the jump to home ownership while homeowners are re-evaluating their current houses and considering moves to new ones that better fit their lifestyles. This has led to a lot of discussion these days about housing market affordability as home prices continue to appreciate rapidly. The most recent index on affordability from the National Association of Realtors(NAR) shows that homes are actually more affordable now than they have been at any point since the housing crash, when foreclosures and short sales dominated the market from 2009 to 2015.
We know when discussing the topic of affordability there are concerns about feeling financially secure. However, consider the benefits of home ownership over renting. According to author Mike Lofting of ‘Homeownership Is Affordable Housing,’ renters pay a higher percentage of their income toward their rental payment than homeowners pay toward their mortgage. He goes on to say that a mortgage payment is like forced savings; it goes toward building equity you will likely get back when you sell your home. There’s no return on your rent payments. Mr. Lofting also brings to light that renters are continuously vulnerable to cost increases; mortgage payments remain relatively the same over time, while rent keeps going up.
On the ladder of financial success, homeownership is the first rung for most households, as their home is often their largest asset. So, with rock bottom mortgage rates helping you save quite a bit of money over the life of your home loan, now is a great time to buy!