The Buy vs. Rent Debate: Why Buying Wins
Written by Erica Christoffer ·
Even though the federal tax credits have expired, it is still wiser to buy now than rent. Our clients get a tax write off and build appreciation instead of throwing money away each month. Home prices are so affordable today it is a good time to take advantage of the buyer’s market conditions with low interest rates and an abundance of properties to select from. Buyers can find great deals on distressed short sales, foreclosure auction properties and REOs (real estate owned), including single-family homes, multi-family dwellings, townhouse, condos and commercial apartment buildings in all areas and price ranges.
If a large down payment is preventing your clients from buying, they can purchase an owner-occupied property (single-family home -4 units) with an FHA loan that only requires a minimum of a 3.5 percent down payment. However, if they are going for traditional financing or buying non-owner occupied investment property, then they will need at least a 20 percent to 30 percent down payment and good credit. If they have less than perfect credit, they may want to investigate seller financing or a rent-to-own program.
So the first decision your clients need to make is what type of property they want to buy and how they intend on using it. Intended uses include:
· Residing in the property
· Renting it out
· Holding on to it
· Flipping it
· Lease optioning
Be sure your clients line up financing right away so they are ready to make an offer when they find the right opportunity.
Timing is everything in buying and selling real estate, and right now is a great time to buy, especially foreclosure real estate. Foreclosures are sold at discounted prices, and they buyer gets a property with built-in equity. One thing for certain is real estate appreciates over time. With affordable prices, all time low interest rates and abundant inventory, there is no reason not to buy.
Travis Broadwater is with Broadwater Properties in West Virginia. Visit his Web site: www.TravisBroadwater.com.