Renting vs. Buying Which is best for you?. The pros of renting A Landlord When a pipe bursts in your rental home, someone else foots the bill to fix it.

Slides:



Advertisements
Similar presentations
Family Economics and Financial Education Take Charge of your Finances
Advertisements

Renting a Residence Section 6-5. Selecting a Rental Unit  A person who rents is called a tenant.  The person who rents the place to you is called a.
The Difference Between Renting and Owning a Home
Renting vs. Buying Housing. Rental Terminology Landlord Owner of property –Expects rent to be paid on time and for tenant to keep the property in reasonable.
Renting vs. Owning The Difference Between Renting and Owning a Home.
Home Buying Process Financial Options. Objectives Define the Four “Cs” of the Loan Process Determine How Much You Can Afford for a House Calculate Front-End/Back-End.
Chapter 9 Buying a Home.
Credit Matters If you ever want: – A job – An apartment – A car – Insurance – Education or training after high school – Affordable utilities – Affordable.
How You Can Sell Your Home in Just 14 Days & for $20,000 More Than Today’s Market Value.
Topic 4 Financing Strategies. Topic 4: Financing Strategies Learning Objectives – (a) Analyze the various sources of borrowing available to a client and.
Carl Johnson Financial Literacy Jenks High School.
Unit Home Ownership Learning Objectives: Understand the three requirements to buy a home How to calculate debt-to-income ratios Realize how home.
Objective 2.03 Analyze financial and legal aspects of home ownership.
The Housing Expenditure. Objectives Discuss the options available for rented and owned housing and whether renters or owners pay more for housing. Determine.
Project Part 3 Daniela Velluto and Justin Hannon.
FIRST TIME HOMEBUYER What do you need to know to make buying your first house easy and affordable.
Buying a Home Vs. Renting Group 1: Elizabeth Anderson, Natalie Christner, Val Denter, Jason Holmes, and Stephanie Stevens Project Part 3 Math F12.
Your First Home: What You Need to Know Presented by Alex Gorodinsky.
BUY A HOUSE HOW MUCH HOUSE CAN YOU AFFORD?. GROUP 5 ERICA MCMILLAN- BRADLEY ELLIS – PILAR GONZALEZ.
BUYING VS RENTING. BUYING Homeowner Advantages  Freedom of use  Pride of ownership  Greater Privacy  Income tax benefits  Opportunity to build credit.
Housing: A Place To Call Home
Renting vs. Owning The Difference Between Renting and Owning a Home.
Renting vs. Owning Family Economics and Financial Education Take Charge of your Finances.
Home buying Case Study By Arthur Espinoza.
RENTING VS. OWNING FAMILY ECONOMICS AND FINANCIAL EDUCATION TAKE CHARGE OF YOUR FINANCES.
MAJOR EXPENDITURES: HOUSING, TRANSPORTATION AND FOOD Advanced Level.
Objective 2.03 Analyze financial and legal aspects of home ownership.
© Oklahoma State Department of Education. All rights reserved.1 Housing Alternatives Standard Renting vs. Buying.
Housing Considerations
Term Project Part 3 Matt Willey. What effect does interest rate have on total payment? A lower the interest rate means less interest paid over all. When.
YOUR COMPANY NAME WE CAN HELP YOU ON HOW YOU CAN SELL YOUR HOUSES FOR TOP DOLLAR WITHOUT PAYING ANY COMMISSION AS A LEASE PURCHASE.
Financing a home Math 1050 Group 3 Presentation. How Much Can You Afford?
Math 1050 Project PART #3. Insight's Home Purchasing Basics Determine that you really want a home. Figure out how much you can afford for a home loan.
Chapter 22: Buying a Home.
MATH 1050 GROUP ASSIGNMENT JOSEPH ROBINSON Buy A Home?
Basic Rules 1.Purchase price/annual income = 2.0 or less 2.Monthly pmt = 33% or less of monthly pay check.
Objective 2.03 Analyze financial and legal aspects of home ownership.
Chapter 9: The Housing Expenditure. Objectives Discuss the options available for rented and owned housing and whether renters or owners pay more for housing.
Renting vs. Owning G1 © Family Economics & Financial Education – Revised March 2009 – Housing Unit – Renting vs. Owning a Home Funded by a grant.
PERSONAL FINANCE Buying a Home. Objectives: Buying a Home Students will understand how key percentages are used to determine how much housing expense.
Term Project Part 3 Completed By: The Unstoppable Force Chase Baker ~ Kelsey Vaseleou ~ Christine Littlefield ~ Jesica Bowman ~ Mason Francom.
Math 1050 – Project Part 3 Group 1 Kaitlin Brady, Nicholas Klco, Cory Shumway, Amanda Wallace, & Krissie Wilson.
Renting Vs. Buying a Home. Scenario A renter starts out paying $800 per month with annual increases of 5%. A homeowner purchases a home for $110,000 and.
Renting vs. Owning Economics2015.  Housing is the largest personal expenditure (About 1/3 of a person’s income.)  Choosing where to live is based upon.
Buying a Home Unit Two—Budgeting Financial Literacy Standard 4 Mrs. Morrey.
“That, of course, is the question. Why buy the cow when you can have the milk? Or the house when you can just rent?” -Raoul Relder Copyright © eNestEgg.
MAJOR EXPENDITURES: HOUSING, TRANSPORTATION AND FOOD Advanced Level.
© South-Western Educational Publishing Buying a Home.
Housing Deciding between Renting and Owning a House.
Chapter 9: The Housing Expenditure. Objectives Discuss the options available for rented and owned housing and whether renters or owners pay more for housing.
How to Know If You are Ready to Buy a Home. For many, the American Dream is still to buy their own home. However, not everyone is at the place in their.
Math 1050 Term Project Brandon Kidd Shirene Mohajer Shojaee Chuck Bergstrom.
Loans. Loan An amount of money borrowed and repaid with interest Interest – Money paid for the right to borrow money  Fixed rate – rate that stays the.
Money Trek Project Module 6: Renting & Buying a House
Family Economics and Financial Education Take Charge of your Finances
Family Economics and Financial Education Take Charge of your Finances
How to Buy Your Own Home Lori Hubbell, Better Homes and Gardens Real Estate
Renting Vs. Buying a Home
Renting Vs. Buying a Home
Major Expenditures: Housing, Transportation and Food
The Difference Between Renting and Owning a Home
Family Economics and Financial Education Take Charge of your Finances
FEFE Take Charge of your Finances
Family Economics and Financial Education Take Charge of your Finances
Family Economics and Financial Education Take Charge of your Finances
The Buying Issue The Buying Issue
Family Economics and Financial Education Take Charge of your Finances
Renting Vs. Buying a Home
The Buying Issue The Buying Issue
Presentation transcript:

Renting vs. Buying Which is best for you?

The pros of renting A Landlord When a pipe bursts in your rental home, someone else foots the bill to fix it. When you own a home, you are responsible for all of your own repairs.These repairs can become expensive extremely fast. Mobility Renting gives you the freedom to take a new job or move to a new city without the hassle of needing to sell your home, which could take months. The freedom to end a lease and take a new opportunity elsewhere can be a major plus for younger tenants. Smaller Down Payment The costs of putting a down payment on a home, along with the costs of closing, can add up quickly. Though rental deposits can seem unreasonable at times, odds are it’s a lot less than the up-front costs of purchasing. Buying a home is a major investment, but in some parts of the country you’ll be paying less in the long run by buying instead of renting. However, buying a home isn’t for everyone. Here are some pros and cons of both buying and renting, and factors to consider when buying a home.

The cons of renting A Landlord When you’re only paying rent on a property, not owning it, there can be varying rules that decide how much you can alter your residence. You may not be able to paint your walls or alter any aspect of the property, a major downside for more creative types who may want more freedom. Equity Writing a rent check every month can add up. You aren’t building any long-term equity when renting a house or apartment, you’re only putting money in your landlord’s pocket. Changes in Rent If you live in a larger city, you may have noticed a hike in rent prices lately. As soon as your current lease ends, your landlord likely has the ability to inflate rent based on demand, a trend that many people are experiencing throughout the country.

The pros of buying Equity If you do decide to move in the future, you have an asset to sell. Depending on the strength of the market, your home could increase in value over the time you own it. Tax Benefits You’ll get tax deductions for your mortgage payment, property taxes, and even some closing costs. These can add up! Freedom It’s your property and you can decorate and improve it as you see fit. Feel free to take on home improvement projects and truly make your house a home, you won’t have any landlords picking your paint colors! Though improvement costs time and money, it truly is one of the most rewarding parts of owning your own home.

The cons of buying Paying for Maintenance You’ll have to invest time and money to keep your home in tip-top shape. If something breaks unexpectedly, you’ll need to be prepared with the emergency funds to cover the costs. Homeowner’s Insurance Renter’s insurance is optional. However, if you have a mortgage, homeowner’s insurance is not. Across the country, homeowner’s insurance rates range from just over $500 to almost $2,000, based on the area’s risk. Property Taxes Just like any other tax, these costs can fluctuate, leaving you paying more than expected.

What to consider when buying a home Are you financially able? Obviously this would be the first thing to look at. But what exactly constitutes “financially able?” Your Income Lenders will look at your income to determine if you’ll be able to pay off a mortgage long-term. They’ll want evidence of stable employment, and will look at your type of income, such as hourly, commission, or salary wages, to determine whether or not you’re financially fit. FICO Credit Score Your credit score can not only affect whether or not you get approved for a loan, it can affect how much you pay in the long run. Generally, you should have a FICO score of at least 620 to get approved for a mortgage, but you can save thousands of dollars each year on your mortgage by waiting until your credit score is up to 760. There are a multitude of factors that can impact your ability to get approved for a mortgage. Here are a few that mortgage lenders pay close attention to.

What to consider when buying a home Debt-to-Income Ratio The Federal Housing Administration has set standards for debt to income ratios to help prevent homebuyers from getting into a home they can’t afford. For your mortgage payment expense to income ratio, the maximum ratio is 31% to qualify for a loan. For example… House payment: Gross monthly income: Debt-to-income ratio: $1,000 $3, %

What to consider when buying a home How long you anticipate staying in the area Think carefully about your future plans and goals. If you are married, this is also something to think of collectively. If you plan on having children, is this an area that would suit their needs? Are there career options in the area that will allow you to advance as you planned? If not, you may be better off renting a home until you’re sure you’ve found an area you plan on settling down in long-term. The upfront costs you will have to pay The standard down payment on a home is 20%, but more is always better. If you cannot afford the 20% down payment, you might not be able to afford the house. There are also closing costs and fees on a home that are often between 2-5% of the total purchase price of the home. Since these are upfront payments, it’s important to take a good look at your finances. However, lenders are required to give you a good faith estimate of what the closing costs will be, so you aren’t caught by surprise.

Need more information? Ready to start looking for a place to rent or buy? Hunter Meek Broker/Owner Metro Properties I have 10 years experience helping buyers and sellers in the Metro area. Visit Metroproperties.com/testimonials to see what my clients have to say. I’d love for you to be the next success story! I’d love to help.