Here is the second part of yesterday's post: the Top 5 Hidden Costs of Renting! Provided by Trulia...
1. Opportunity Costs. When you rent, you lose out on the equity -- which can mean an increase in your home's value but, even in a down market, can also mean the chance of ever owning the place you live free and clear.
2. Income Taxes. If you earn above a certain level of income, the income taxes you're paying as a renter will be substantially higher than they would be if you owned a home and could deduct your property taxes and mortgage interest.
3. Storage. Many a renter simply has too many personal belongings to stuff into their small apartment, so it's not uncommon for tenants to also pay for a storage space, without calculating that expense into their "housing" budget.
4. Costs of Improving the Property. Long-term renters may paing, replace the flooring, and do other improvements to make the place livable. But since it's not technically "their" home, when they DO move out, all the cash they invested is lost. In fact, some landlords may require them to pay or forfeit deposit money to bring the place back to its original, neutral decor.
5. Lost Deposits. Anyone who has rented more than a couple of apartments is well aware of the chances of losing some or all of your security or pet deposits, no matter how well you care for your home.
http://www.trulia.com/blog/taranelson/2011/01/hidden_costs_of_owning_and_renting_hold_until_rvb_012411?ecampaign=cnews201101C&eurl=www.trulia.com%2Fblog%2Ftaranelson%2F2011%2F01%2Fhidden_costs_of_owning_and_renting_hold_until_rvb_012411
Showing posts with label rent. Show all posts
Showing posts with label rent. Show all posts
Friday, January 21, 2011
Thursday, January 20, 2011
Own vs. Rent?
I came across a great article today from Trulia discussing the Top 5 Hidden Costs of Owning and the Top 5 Hidden Costs of Renting. It's great information, and I thought I'd pass it on! Today will be the owning portion of it and tomorrow will be about renting! Enjoy!
1. Special Assessments. HOA dues to maintain the complex come as no surprise to condo owners, but hefty special assessments to make unexpected (and unbudgeted) repairs to the roof, windows, boiler, or even foundation often catch unit owners unawares. Even if your home doesn't belong to an HOA, don't be surprised to see special assessments tacked on top of your property tax bill, covering public services including things like street lighting, tree trimming, pest control, libraries, and even schools.
2. Utilities and services you didn't need while renting. Many renters have never had to pay for things like gas, garbage, water and pest services, and they've also looked to their electric, gas, garbage, alarm, water, pest, home warranty - which mitigates larger surprise costs of unexpected major repairs, gutter cleaning/maintenance, snow removal/winterizing, etc.
3. Private Mortgage Insurance. Today's savvy homebuyers are well aware that they'll have to pony up for private mortgage insurance, or PMI, if they're putting less than 20 percent down on their mortgage. But the cost of PMI has spiked over the last year, and the amount definitely catches buyers off guard.
4. Penalties and fines. HOA rule violations, like parking in the wrong spot, installing hardwood floors in an upstairs unit, or painting your home a forbidden hue can result in surprising fines, on top of the costs of remediating the issue. Even single-family homeowners can get ticketed and/or fined by their city or town for violations like having overgrown weeds or other building code violations - especially those which create fire and safety hazards.
5. Items you didn't need while renting, but you do as a homeowner. This varies based on your climate and the type of home you own, as well as on the services you outsource, but can include landscaping equipment (e.g., lawn mower, snow/leaf blowers), washer/dryer, fridge, window treatments, and light fixtures.
http://www.trulia.com/blog/taranelson/2011/01/hidden_costs_of_owning_and_renting_hold_until_rvb_012411?ecampaign=cnews201101C&eurl=www.trulia.com%2Fblog%2Ftaranelson%2F2011%2F01%2Fhidden_costs_of_owning_and_renting_hold_until_rvb_012411
1. Special Assessments. HOA dues to maintain the complex come as no surprise to condo owners, but hefty special assessments to make unexpected (and unbudgeted) repairs to the roof, windows, boiler, or even foundation often catch unit owners unawares. Even if your home doesn't belong to an HOA, don't be surprised to see special assessments tacked on top of your property tax bill, covering public services including things like street lighting, tree trimming, pest control, libraries, and even schools.
2. Utilities and services you didn't need while renting. Many renters have never had to pay for things like gas, garbage, water and pest services, and they've also looked to their electric, gas, garbage, alarm, water, pest, home warranty - which mitigates larger surprise costs of unexpected major repairs, gutter cleaning/maintenance, snow removal/winterizing, etc.
3. Private Mortgage Insurance. Today's savvy homebuyers are well aware that they'll have to pony up for private mortgage insurance, or PMI, if they're putting less than 20 percent down on their mortgage. But the cost of PMI has spiked over the last year, and the amount definitely catches buyers off guard.
4. Penalties and fines. HOA rule violations, like parking in the wrong spot, installing hardwood floors in an upstairs unit, or painting your home a forbidden hue can result in surprising fines, on top of the costs of remediating the issue. Even single-family homeowners can get ticketed and/or fined by their city or town for violations like having overgrown weeds or other building code violations - especially those which create fire and safety hazards.
5. Items you didn't need while renting, but you do as a homeowner. This varies based on your climate and the type of home you own, as well as on the services you outsource, but can include landscaping equipment (e.g., lawn mower, snow/leaf blowers), washer/dryer, fridge, window treatments, and light fixtures.
http://www.trulia.com/blog/taranelson/2011/01/hidden_costs_of_owning_and_renting_hold_until_rvb_012411?ecampaign=cnews201101C&eurl=www.trulia.com%2Fblog%2Ftaranelson%2F2011%2F01%2Fhidden_costs_of_owning_and_renting_hold_until_rvb_012411
Friday, September 24, 2010
Ten Reasons to Buy a Home
1. You can get a great price. We're four to five years into the biggest housing bust in modern history and prices have come down a long way. Will prices fall further? Sure, they could. You'll never catch the bottom and most likely will miss it completely.
2. Mortgages are cheap. You can get a 30 year fixed rate loan for less than 4.5% free money. What's not to like? These are the lowest rates on record. If/when inflation picks up, you won't see these rates again in your lifetime. Should we get deflation, and rates go down, you can refinance!
3. You'll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes too!
4. It'll be yours! You can have the kitchen and bathrooms you want. You can move the walls, build an extension or paint everything bright orange. You will feel better about your own place if you own it rather than rent it.
5. You'll get a better home. It can be really hard to find a good rental. Generally speaking, if you want the best home in the neighborhood, you're better off being the owner.
6. It offers some inflation protection. Over the long term housing has tended to beat inflation by a couple of percentage points a year. Especially in Orange County. That's valuable inflation insurance, especially if you're young and raising a family and thinking about the next 30 or 40 years. According to CAR, statewide medium price is up 8.6% for the past year and it is the 10th consecutive year-over-year gain!
7. It's risk capital. No, your home is not the stock market and you shouldn't view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up too. Equity in a home is another way of linking part of your portfolio to the long term growth of the economy and still managing to sleep at night.
8. It's forced savings. You're just paying yourself by building equity. As a forced monthly saving, its good discipline. It's not all about appreciation, think debt reduction too.
9. There is a lot to choose from. CAR's unsold inventory index for single-family resales in August was 6.1 months vs. 4.6 months a year earlier. More keep coming onto the market too. That means great choices as well as great prices.
10. Sooner or later, the market will clear. Demand and supply will meet. The population is forcasted to grow by more than 100 million people over the next 40 years. Prices will rise and so will interest rates.
Provided by: wsa.com
2. Mortgages are cheap. You can get a 30 year fixed rate loan for less than 4.5% free money. What's not to like? These are the lowest rates on record. If/when inflation picks up, you won't see these rates again in your lifetime. Should we get deflation, and rates go down, you can refinance!
3. You'll save on taxes. You can deduct the mortgage interest from your income taxes. You can deduct your real estate taxes too!
4. It'll be yours! You can have the kitchen and bathrooms you want. You can move the walls, build an extension or paint everything bright orange. You will feel better about your own place if you own it rather than rent it.
5. You'll get a better home. It can be really hard to find a good rental. Generally speaking, if you want the best home in the neighborhood, you're better off being the owner.
6. It offers some inflation protection. Over the long term housing has tended to beat inflation by a couple of percentage points a year. Especially in Orange County. That's valuable inflation insurance, especially if you're young and raising a family and thinking about the next 30 or 40 years. According to CAR, statewide medium price is up 8.6% for the past year and it is the 10th consecutive year-over-year gain!
7. It's risk capital. No, your home is not the stock market and you shouldn't view it as the way to get rich. But if the economy does surprise us all and start booming, sooner or later real estate prices will head up too. Equity in a home is another way of linking part of your portfolio to the long term growth of the economy and still managing to sleep at night.
8. It's forced savings. You're just paying yourself by building equity. As a forced monthly saving, its good discipline. It's not all about appreciation, think debt reduction too.
9. There is a lot to choose from. CAR's unsold inventory index for single-family resales in August was 6.1 months vs. 4.6 months a year earlier. More keep coming onto the market too. That means great choices as well as great prices.
10. Sooner or later, the market will clear. Demand and supply will meet. The population is forcasted to grow by more than 100 million people over the next 40 years. Prices will rise and so will interest rates.
Provided by: wsa.com
Sunday, March 21, 2010
Rent vs. Buy?
This is one of the most frequent questions we hear..."Should I keep renting, or should I buy?" Many people believe that renting is more affordable. However, they may be wrong! Usually, a mortgage payment can be as much as your monthly rent, or just a little more expensive. I urge you to take a look at the following link and play around with the numbers. It may open your eyes and convince you to go after that dream home!
http://www.phmtg.com/calc_rentvbuy.html
http://www.phmtg.com/calc_rentvbuy.html
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