2013 Rent Vs Buy
To Rent or To Buy? That Is the Question
While sources may differ about how positive the move in the residential housing market has been, they mostly concur that the worst is behind us and we are in recovery. Last year ended on a positive note, with C.A.R. reporting a 27 percent year-over-year increase in median price, and this year is not off to a bad start, with a January median price of $337,040—24 percent higher than the January 2012 median price. Home sales made more modest progress, ending 2012 with a one percent year-over-year gain in December. Due to the constrained supply of inventory, sales declined to 491,720 in January 2013—a 3.9 percent drop from 511,760 a year ago.
With
the housing market on its way to prosperity again, consumers are
contemplating whether it is more beneficial to buy a property now or
continue renting. To assist with this decision, C.A.R. has looked at the
costs and benefits of renting versus owning property in California and
eight of its local regions over a seven year period. The costs of
buying include the monthly mortgage payment, insurance and taxes, and
improvements and repairs. These costs were offset by the benefits of
buying: mortgage interest and property tax deductions, and investment
appreciation. The costs of renting include the monthly rent payment and
renter insurance, which were offset by the benefits of renting: the
appreciation on investing the down payment in the stock market.
For the State of California, consumers can save 32 percent per month by buying a property. At the local level, buying in the Inland Empire or in Los Angeles County will save you 40 percent per month. Home buyers in Sacramento will save 34 percent monthly, 15 percent in San Diego, and 12 percent in San Francisco. However, buying is not the best solution everywhere. You are better off renting in Orange, Alameda and Santa Clara Counties, with monthly rent savings ranging from seven percent to 11 percent.
Do not hesitate to contact me at (415) 832-9151 for any real estate purpose you may have.
Janice Lee
415-832-9151
International President's Elite
Top Producer, Realtor
JaniceFLee@gmail.com
www.JaniceLeeHomes.com
BRE #01720205
While sources may differ about how positive the move in the residential housing market has been, they mostly concur that the worst is behind us and we are in recovery. Last year ended on a positive note, with C.A.R. reporting a 27 percent year-over-year increase in median price, and this year is not off to a bad start, with a January median price of $337,040—24 percent higher than the January 2012 median price. Home sales made more modest progress, ending 2012 with a one percent year-over-year gain in December. Due to the constrained supply of inventory, sales declined to 491,720 in January 2013—a 3.9 percent drop from 511,760 a year ago.
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| Exhibit 1: Median Home Price and Home Sales |
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| Exhibit 2: Monthly Savings of Renting vs. Buying |
For the State of California, consumers can save 32 percent per month by buying a property. At the local level, buying in the Inland Empire or in Los Angeles County will save you 40 percent per month. Home buyers in Sacramento will save 34 percent monthly, 15 percent in San Diego, and 12 percent in San Francisco. However, buying is not the best solution everywhere. You are better off renting in Orange, Alameda and Santa Clara Counties, with monthly rent savings ranging from seven percent to 11 percent.
Do not hesitate to contact me at (415) 832-9151 for any real estate purpose you may have.
Janice Lee
415-832-9151
International President's Elite
Top Producer, Realtor
JaniceFLee@gmail.com
www.JaniceLeeHomes.com
BRE #01720205
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