With all the real estate choices available nowadays, California residents contemplating a move may be wondering if they should buy a home or rent one. While purchasing a home may seem more expensive, considering rising interest rates and inflation, studies have shown that renting is actually more costly in the long run.
According to the real estate data firm ATTOM Data Solutions, it is more expensive to rent than buy in more than two-thirds of United States counties. The company based its report by studying medium-priced dwellings within 540 counties, comparing monthly mortgage payments with monthly rents on three-bedroom apartments. Some of those counties with more expensive rents included Maricopa County, Arizona; Cook County, Illinois; Clark County, Nevada and Philadelphia County, Pennsylvania.
However, in some places, such as Chicagoland, Silicon Valley and several New York counties, renting a home is far more affordable than buying one. For instance, renting a three-bedroom house in Houston would require roughly 27 percent of the tenant's average income. On the other hand, it would take almost 30 percent of an average person's income to purchase the home.
Overall, however, rent costs are going up faster than home prices in nearly 27 percent of markets. Nevertheless renting is an attractive option for those who are planning to reside in an area for less than three years. For those who are looking for a long-term home, purchasing makes more sense.
For most people, a home is their largest investment. To purchase wisely, many potential homeowners seek guidance from a real estate attorney who can assist with matters such as preparing the legal documents, title issues, the closing process and short sales.