Taking the leap from renting to buying a home is one of the biggest financial decisions a person can make. But did you know than a monthly mortgage payment can often be cheaper than paying rent?
According to a study done last year by trulia.com, buying a home is 23% cheaper than renting nationwide. To put that into perspective, consider that as of May 2016 the average rent for a one-bedroom apartment in Chattanooga is $792 and a two-bedroom comes in at an average of $965, according to rentjungle.com. This is a pretty hefty sum of money to be putting toward something that won’t be an investment for you in the long run.
With mortgage rates at an incredible low and rental prices only getting higher, there is no better time than now to purchase your own home, says Christina Lane, senior loan officer with Movement Mortgage.
“Interest rates are still at historical lows and will inevitably rise soon,” she says. “In most cases, you can get into a home with a much lower payment than an apartment or rental home.”
The only issue for many new homebuyers is the fear of coming up with the required down payment, which is usually 10-20% of the purchase price of the home. But Lane says this shouldn’t be a deterrent for someone looking to make the jump from renting to buying.
“There are still first time homebuyer programs available that offer down payment assistance for eligible buyers,” she says. “The interest that you pay for your mortgage is tax deductible and you have the pride of homeownership—the American dream!”
So what do you have to lose? For everything there is a season, and the same goes for great interest rates. Pretty soon those will start to increase, Lane says, and the opportunity to purchase a home can become further out of reach for you.
“With the upcoming election, my guess is that interest rates will start to increase rapidly,” she says. “I would highly recommend anyone that is on the fence to check your options on becoming a homeowner!”
