Is Now a Good Time to Rent a House?
People often ask me if now is a good time to buy a home. No one ever asks if now is a good time to rent. However, I want everyone to understand that today is NOT a good time to rent.
The Census Bureau recently released their third quarter median rent numbers. As you can see, this graph shows rent increases from 1988 until today – with a sharp increase since 2014.
A recent Wall Street Journal article reports that rents rose
“faster last year than at any time since 2007, a boon for landlords but one that has stoked concerns about housing affordability for renters. In general, the higher rents go, the more difficult it will be for young people to save for down payments, making them likely to rent even longer.”
The article also cited results from a recent Reis Inc report which revealedaverage effective rents rose 4.6% in 2015, the biggest gain since before the recession. Over the past 15 years, rents have risen at a rate of 2.7% annually.
Where are rents headed?
Jonathan Smoke, Chief Economist at realtor.com recently warned that:
“Low rental vacancies and a lack of new rental construction are pushing up rents, and we expect that they’ll outpace home price appreciation in the year ahead.”“
Real Estate Bottom Line
One way to protect yourself from rising rents is to lock in your housing expense by buying a home. If you are ready and willing to buy, let’s determine if you are able to buy!
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