Are you one of the thousands of individuals renting and wishing you could buy a house, but feel it’s impossible to afford? You’re not the only one. Many by the age of 30 will have spent a roughly $93,000 in rent. Wait, $93,000? That’s 46% of their income going towards housing that will never be theirs. Don’t get me wrong; there are a lot of positives to renting. It’s convenient; you only have to commit to a year at a time, when your fridge decides to stop working you get to call the landlord to fix it and you can vote for every property tax levy knowing it won’t directly impact your rent.
Owning your own home can by far outweigh the comfort of renting. Home equity is one of the many significant benefits. Your monthly mortgage payment will go towards the interest on your loan and the principal (the amount that is yours to keep when you sell down the road). Then there’s the freedom to add the touch of your taste and personality. Remodel your heart out, paint the walls every color you’ve ever dreamed of and not to mention, the autonomy of having the pet you’ve always wanted. According to Zillow’s senior economist, Aaron Terrazas, Seattle homeowners are gaining $54.24 of home equity for every working hour. Think about this. If you work a 40 hour work week, you’ll be gaining almost $8,700 a month in equity.
When it came time for me to buy my first house, I was terrified. I’ve always rented and the thought of spending all of my hard earned savings sounded like a terrible idea. When, my wife, Brit and I made the undoubtedly hardest and best decision to pursue the exciting adventure of searching and owning our first home we never thought it would have actually become a reality. Even through our six month search and losing offers on two houses we still felt like it was always a distant dream. I’ll never forgot the night we got the news that we were the winning offer on our home. Three years later, we have added to the history of our house, remodeled certain aspects to align with our tastes and added two little ones to add their touch of charm. In just these three years our home value has dramatically increased and appreciated roughly $260,000!
If you’re playing with the idea of buying, but need a resource that will help you understand and break down the numbers I’ve frequently relied on Trulia’s Rent vs. Buy Calculator. This calculator will give you a quick guesstimate of whether it’s financially a good time to consider buying. If you’re feeling a bit more serious about pursuing buying and want a reliable source, I would recommend getting pre-qualified by a reputable local lender. I’m here to help as I know quite a few local lenders that I would gladly recommend. Even if you know that your time to buy won’t be until another year or two, getting pre-qualified now will tell you how much you can afford to buy while you’re looking.