When considering their housing options people often assume that renting is more affordable than purchasing a new home. While this can be true, the rental market is changing and often purchasing a new construction home is the most affordable option and will definitely offer better long-term financial benefits.
Changes in the Rental Market
The Guide regularly checks in with local real estate agent and the onsite agents that sell homes in new construction communities. Both sectors have mentioned that they have noticed a common trend- that rentals in the Charleston market are getting more scarce and that the limited supply is driving up prices. The rental market has become so competitively priced that homeownership often provides comparable square footage and home amenities for lesser cost than a rental. Bloomberg.com just released yearly data from Zillow showing that an increase of $20.6 billion was spent on rental housing in America over the last year. This was the result of less Americans owning their homes and tightened inventory. The large surge in foreclosures during the downturn in the housing market has resulted in many former homeowners moving into rental homes. The number of owner-occupied houses fell over the last year while the number of renter-occupied residences increased by 1.2 million. A Zillow economist explained that home prices will be slower to rise than rental prices because there is a large inventory of non-distressed properties that not as competitive for investors who seek distressed properties on which they can capitalize.
Because of theses shifts in the market, don’t just assume that homeownership is unattainable. Talk to a Mortgage lender to see if you can prequalify for a home loan. Once you’re prequalified for a loan, you’ll know how much you can spend and what your monthly payment will be. Compare the monthly mortgage payment on a new construction home to a rental payment- you might be surprised at how much new home you can get & how affordable it will be! Stay tuned for more details on the financial benefits of homeownership. Use The Guide to help find a great value on a beautiful new home. Learn more about Charleston area new home neighborhoods.
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