Is It Better To Rent Or Buy A Property In Indian Land?

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Buying Homes in Indian Land

There seems to be a lot of confusion about whether it’s better to lease (rent) a property or buy your own home.

The answers we find in print or on the web throw statistics at the question. But in the end they prove through numbers that one side or the other is more beneficial.

In truth, although facts and figures play into the debate, there are a lot of factors that go into whether a person feels more willing to lease a property from year to year or own for the long-term.

One popular home search website, Trulia did a study in the Charlotte area and found that:

“Purchasing a home is 39.4% cheaper than renting in the Queen City — assuming that a buyer put forth a down payment of 20%, obtain a 30-year fixed mortgage and plan to reside in the property for at least seven years.”

The study does not seem to account for intangibles such as home maintenance repair, remodeling, or cost of appliances that may be provided to a renter. Even with such factors, the 39.4% savings over the 7-year period measured would probably tip things in favor of buying.

Calculating If It’s Better To Rent Or Buy In Indian Land

Trulia also provides a buy vs rent calculator available at Trulia Rent vs Buy Calculator, which allows you to adjust the down payment option and target rental payment.

I used the Indian Land zip code of 29707, a purchase price of $300,000 with a 5% down payment. Finally, I set my target rental payment to $1850/month.

My results: Buying is cheaper than renting after 2 years.

Evaluating The Numbers

The metrics behind the numbers evaluate increasing rental payment from year to year, lack of equity owned by renters, and the appreciating value of a home over time.

In a relatively stable, appreciating market like ours, owning a home has generally proven to be a good investment. In addition, given the comparatively low rate of property taxes throughout the Carolinas, people often find they can own an equivalent home through financing, for less than their current rental payment.

However, as stated at the beginning of this article, it still comes down to more than numbers. There are often barriers to homeownership. Down payment, closing costs, credit concerns, job stability, confidence that a person will remain in an area long-term. All of these can be reasons why in spite of the numbers, renting is the better – or only option.

Additionally, we see different demographics preferring the freedom that renting allows for. If something is in need of repair, it often takes a call and someone else is responsible to get it done. Annually a person has the ability to assess the property, neighborhood, amenities, and proximity to entertainment, employment, and possibly schools and move with relative ease.

The negatives of renting, however, can cause hardship as well. Annual increases in rental payment are hard to account and/or adjust for at times. A lease can be legally non-renewed in SC with as little as 30 days notice to the renter. The uncertainty of your home being sold and a lease not renewed can be unsettling but this is far less prevalent for apartment dwellers. Finally, an absentee or inattentive landlord can also cause more than his/her fair share of grief.

Conclusion

In the end, it comes down to choice and circumstance.

In my experience, most renters – especially those with families – would prefer to own.

Home ownership continues to be part of the “American Dream” and many currently not partaking of that dream gladly would, if barriers preventing it could be neutralized.

Regularly, I encounter those that due to credit, lack of savings, or lack of sufficient documentable income, believe home ownership is beyond their reach. It’s truly not a question of whether it’s more financially beneficial to own, but does a person have the desire and ability to make the leap.

Got Questions? John has answers.

If you would like to speak with an experienced loan consultant, feel free to reach out to John Kotrides. He excels at meeting your unique home financing needs with a wide variety of loan options. Oh, and he loves Indian Land!

John Kotrides – Mortgage Banker and Correspondent Writer
John Kotrides
Mortgage Banker
NMLS #482040, Licensed in NC & SC
3430 Toringdon Way, Suite 101, Charlotte, NC, 28277
Office: 980-500-9200 x 5208 | Mobile: 704-461-3734 | Fax: 855-682-6918
johnkotrides@atlanticbay.comAtlantic Bay – John Kotrides

 

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John Kotrides started his career in the banking and mortgage industry in 2003. He understands all clients are different and require different levels of service, as well as different avenues of communication. “Nothing creates more anxiety than silence. Regular communication is key. I don't disappear after 5 p.m. or during the weekend. I’m always accessible and return calls promptly.” – John Kotrides. Having relocated himself, John enjoys working with those moving to the area for the first time. “The type of buyer that takes the risk to make a major move in the interests of finding new challenges, better opportunities, or just a new adventure, appeals to me greatly,” John says. “Being entrusted to advise and guide them through an intricate, emotional, and life-changing transaction is a heavy responsibility and one I take seriously.” While the mortgage process culminates in a closing, John points out that’s it’s really an opening of the next stage of their lives. “I’ve helped many families over my career — families that relocated due to happy circumstances and tragedy alike. Transactions necessitated by marriage, others by divorce,” John says. “Regardless of the reason, I know that in some small way, I made the experience easier, more transparent, and in the end, helped them along their journey. I hope it’s everything they dreamed it could be.”

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