Housing in many major US cities is among the least affordable in the world. With the competitive nature of the real estate business, affordability is becoming a nightmare. The Bay Area housing market has turned away people who just want to live for a few months before finding a permanent place because it is increasingly becoming cheaper to buy a house than to rent, if you look at it as a long-term investment.
With the mixed signals coming from homebuyers, many people are still uncertain whether home buying is a wise decision in the Bay Area. Numerous news outlets have reported people saying that it is cheaper to buy a home than rent it every month. With the American economy marginally losing its stability in the past few years, the decision for households to rent or buy is proving to be too close to call.
The Bay Area housing market has a tendency of increasing the rent and appreciation of homes and apartments. This trend seems to be the order of the day if the reports of the last few years are anything to go by. Serious homebuyers and real estate agents who have dared to do the calculation of the difference that exists if someone were to make a choice of buying or renting a house in this area say that it cannot be more than 8 percent.
If the consideration that comes with renting is put in place with things such as the monthly payments on the mortgage, maintenance, insurance, taxes and, of course the annual appreciation of rent, it is now clear that renting an area with high demand for homes cannot amount to any sort of savings.
Should you buy or rent?
Many factors need to be put in place if one wants to rent or buy a home. Questions such as the expectation of the homeowner in terms of the home appreciating in value in the near future are pertinent here. If the intention is staying in the same place for at least five years, then this would be enough ground to buy rather than rent if you can afford it.
Other factors, such as family commitments may also force one to buy rather than rent. For instance, living in an area with the best schools may force an individual to buy a home to give their children stability.
Stay abreast with all the statistics of home prices for the last three to four years, to master the appreciation and depreciation that may affect the final buying price or the monthly instalments. It is important that one stays updated on the Bay Area housing market. This will make the buying decision effortless.