Housing Market is in Buy Territory
According to the latest quarterly Beracha, Hardin & Johnson Buy vs. Rent (BH&J) Index, the U.S. housing market has moved deeper into buy territory. That does this mean for you? It means buying a home remains a sound investment.
In today’s housing market, is it better to rent or buy a home?
The BH&J Index examines the entire US housing market and then isolates 23 major cities for comparison. The researchers “measure the relationship between purchasing property and building wealth through a buildup in equity versus renting a comparable property and investing in a portfolio of stocks and bonds.”
Ken Johnson, one of the index’s authors explains:
“Housing prices, in general, continue to slow and when considered in light of the recent trends in the Buy vs. Rent Index signal that ownership remains an excellent investment for the majority of Americans.”
Dallas, Denver, and Houston are three of the major cities that are currently deep into rent territory. In these three markets, it is estimated that renting will top home ownership 7 out of 10 times. Simply put, home prices in these areas will begin to return to more normal levels once residents realize that renting may be a better choice, therefore bringing home affordability back as well.
Real Estate Bottom Line
The majority of the country is strongly in buy territory. Buying a home makes sense financially. Rents are predicted to increase over the next year. Protect yourself from rising rents by locking in your housing cost with a mortgage payment now.