There was a time in the not-so-distant past that renting a Central New Jersey home made more sense than owning one. When prices skyrocketed, it made many homes unaffordable for buyers. Now, rents are going up, home prices are going down and interest rates remain at incredibly low levels. Here are the top four reasons I believe you should own instead of rent:
Reason #1 - Equity. The simple fact is that you can't have equity in a property you don't own. When you rent, you're paying someone else's mortgage and, therefore, increasing their equity with every payment. The further down you pay the principal on your Central New Jersey home, the more equity you build up. Even with the extreme ebb and flow the real estate market has seen in recent years, owning property continues to be a profitable business over the long run.
Reason #2 - Budgeting. With a lease agreement on a rental property, your payment remains the same only for the length of the lease (typically, 6-12 months). After that, there will inevitably be an increase in payment. When you purchase your Central New Jersey home with a 30-year fixed rate loan, your monthly mortgage payment remains the same throughout the entire life of the loan. This can be an incredible help when you are creating a household budget or a long-term financial plan.
Reason #3 - Community Involvement. Homeowners tend to put more of an investment in their community at large when they own their homes. Renters typically see their communities as a temporary stop while homeowners know they'll be staying there for a while. This will generally also helps make children feel a bit more stable.
Reason #4 - Bargains Galore! Prices have come down considerably in the past couple of years. In many places, they are beginning to go back up. The loose lending practices that helped many homeowners get into homes they couldn't afford in the past are gone. That's a good thing, though. You can still score a great deal on a Central New Jersey home as long as you have decent credit and a downpayment.
Many US citizens still believe that homeownership is a huge part of the American dream. It remains a good investment over the long run. Prices are great, inventory is available and low interest rates make homeownership more affordable than renting most of the time. If you're interested in buying a Central New Jersey home, contact me today!
Ellen Manzi, your Central New Jersey Certified Distressed Property Expert
Originally postd on my New Jersey Horse Property blog here: http://horsepropertyhomes.com/2011/11/26/owning-a-central-new-jersey-home/.