Buying has absolutely remained quite a bit less expensive for people in Illinois. The market has pushed rents up all over for several reasons. One being that in the recession, there was a large amount of people who were displaced from their homes and were forced to find rental property for themselves and their families. Another reason is that millennials started out in the job market later than before and because of student loan debt and other financial challenges needed to rent until saving for their future. Finally, I believe that the lack of inventory in a first time home buyer price range has stalled the market.
The interesting part is that now is the best time to invest in real estate as a first time home buyer than it has been in a long time. The mortgage interest rates are still at an all time low. Also, there are great incentive still available in Illinois for first time home buyers such as the IDHA (Illinois Housing Development Authority) $7500 down payment assistance program that allows buyers who meet the criteria to apply for an addition loan that doesn't need repayment after 5 years in the property. It's definitely worth looking into seeing if you qualify. Call our guy David Tomczak if you'd like to know where you stand.Contact David Tomczak
In the latest Rent vs. Buy Report from Trulia, they explained that homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage in the 100 largest metro areas in the United States.
The updated numbers show that the range is an average of 3.5% less expensive in San Jose (CA), all the way up to 50.1% less expensive in Baton Rouge (LA), and 33.1% nationwide!
A study by GoBankingRates looked at the cost of renting vs. owning a home at the state level and concluded that in 39 states, it is actually ‘a little’ or ‘a lot’ cheaper to own (represented by the two shades of blue in the map below).
One of the main reasons owning a home has remained significantly cheaper than renting is the fact that interest rates have remained at or near historic lows. Freddie Mac reports that the current interest rate on a 30-year fixed rate mortgage is 3.91%.
Nationally, rates would have to reach 9.1%, a 128% increase over today’s average of 4.0%, for renting to be cheaper than buying. Rates haven’t been that high since January of 1995, according to Freddie Mac.
Buying a home makes sense socially and financially. If you are one of the many renters who would like to evaluate your ability to buy this year, let’s get together and find you your dream home.