Although home ownership is the American Dream, thanks to many factors, including rising prices, tight lending practices and reduced inventory, home ownership rates are down. This is tragic, since studies reveal that people who own homes have greater peace of mind and higher net worth than their rent-paying peers. The reason? Homeownership is a form of forced savings. Every time you pay your mortgage, you contribute to your net worth. Whereas, each time you pay your rent, you increase your landlord’s net worth. This blog discusses whether you should buy or rent.
Benefits to Home Ownership
High demand and a limited supply of rentals have pushed rents to all-time highs. As a result, in Southern California, in many cases, monthly mortgage payments are comparable to rentals for similar properties. The benefit to home ownership is that a mortgage is paying down your principal rather your landlord’s.
Static Monthly Payments
If you lease or rent, your landlord could raise your rent. On the other hand, homeowners can rest assured that their monthly mortgage payment will remain steady for the life of today’s typical low fixed rate loan.
If you ever need (or want) to downsize, even if your home has not yet been paid off, you could potentially use equity to make a large down payment on a smaller home. Thus, you could enjoy a much lower monthly mortgage payment than you were paying for a large home. Better yet, if you purchase several properties, you could allow tenants to pay off the associated mortgages so you could use the rental income to supplement your retirement income.
Homeowners get to do whatever they want to their residence without asking someone else’s permission. (Of course, if you’re in a community that enforces Covenants, Codes & Restrictions (CCRs) or a Homeowner Association (HOA) regulations, you’ll have to abide by these.) But if you own a home, you can put holes in the walls to hang pictures, paint whatever color you like, and adopt as many pets as you desire. As long as you rent, you will be accountable to someone other than yourself. Wouldn’t you rather call the shots?
FICO Score Matters
Few landlords lease their property to someone who can’t afford to pay their bills. Since good credit is required for leasing as well as purchasing, why not to buy a home? If you have less than perfect credit, Jorge Abich, a licensed loan officer with more than 25 years of experience, can refer you to sources who could help you improve FICO scores.
Low Interest Rates
Rents in the San Gabriel Valley, where SoCal Platinum Properties is based, average $1,714 a month for apartments, which is similar to the average mortgage payment. As a result, now is the time to buy…while interest rates remain competitive despite recent modest increases.
If you’re not sure whether you could potentially qualify for a mortgage rate, or if you would like to know if you should put the home you own on the market, call SoCal Platinum Properties. We will be happy to help you navigate the 2021 housing market.
About SoCal Platinum Properties, Inc.
If you are interested in buying or selling property in or around San Dimas, California and the surrounding area, don’t get caught in a Catch 22 — owning two homes or none at all. We list properties and advertise them to guarantee a swift sale for maximum profit. We also assist home buyers as they hunt for, make competitive offers, and purchase residential property. Realize your dream of homeownership, reduce your house payments to free up funds for whatever purpose you see fit. We offer the following refinance options: We offer the following Refinancing Programs: FHA Streamline, FHA Cash Out, FHA 203k, VA Streamline, VA Cash Out, Conventional, Commercial and Jumbo loans. Lock in your low rate today (213) 709-5178.