OVERVIEW OF SURVEY RESULTS
In a new survey about home ownership and renting, an average of 1 in 5 renters said that they would look into buying a home within the net year or so. When they were asked to look five years into the future, only around 31 percent of renters expected to still have a landlord. The majority of respondents planned to buy houses within three years. All together, 41 percent of people who were renters stated they didn t believe they would still be renters after two years. Another 56 percent of the individuals polled believed they would not be renters after three years. And to round it out, 60 percent wouldn t be renters in four years, 69 percent wouldn t be renters in five years.
INFORMATION ABOUT BUYING A HOME
The first topic you should think about when deciding to move from renting to buy houses is your savings. Because if you decide to buy houses, you need to have a handle on your money situation. Not very long ago, new mortgage products were available to assist homebuyers who did not have enough money. Traditionally, the down payment for a home is 20 percent. And back before our housing market meltdown, some unsavory lenders would have let you walk away with less of a down payment than that. Since that time, lending requirements have become a lot more restrictive when trying to buy houses. In this new environment, you will need a larger savings in order to purchase a home.
Even though it sounds daunting, this tightening on credit and loans is actually good for us. What I mean by this is it will prevent us from borrowing too much money to buy houses and possibly owing more than your home is worth.
MORE INFORMATION ABOUT BUYING A HOME
Another great advantage of moving up to buy houses versus renting is the investment potential. One of the great advantages of buy houses is the ability to build equity in it. This is accomplished by property appreciation, your down payment and making principal payments on the loan. Real estate has always been a very good way to invest money. And that goes for renters or someone who wants to buy houses.
Another advantage is being able to have steady payments every month that you can possibly refinance for lower payments. Some financial obligations when you buy houses are things like property taxes, HOA fees, homeowners insurance, etc. In terms of percentages, you will spend anywhere from 28 percent to 31 percent of your total income on these expenses. This is a lot different from being renters. And if your expenses per month are in excess of 40 percent of your income, you won t get a mortgage. And here is one more piece of information for all of you renters who want to buy houses. Although you have to pay property taxes, you can deduct them at the end of the year.