Renting or Buying, What Would You Do?
Are you someone that would rather rent than buy? Honestly, I don't see how anyone would want to rent if your able to buy. I know I wouldn't rent! However, if your not sure if your going to be or want to be in the area your in for a long period of time (I say at least 3 years), if your budget isn't good enough to take on that type of investment, or have credit issues, then renting is really the only logical thing to do. But you need to work on all of those things, to make it possible for you to buy.
Think about this, your renting someone else's home, paying them a monthly payment to stay there and I am sure the payment is higher than their loan payment is, to make a bit of a profit. Who wouldn't want to make a profit on a rental property? Except for you, it's just tossing money out the window. You are going to have to eventually move from that place and you won't have anything to show for it except all the money you just tossed away. Depending how long you stay there or rent from someone, it can be very costly over the years, especially with rental prices rising each year. Your rent is $850, that is $10,200 for just a year, and of course that doesn't include your security deposit and cleaning fees when you first move in. As you can see renting can get very costly for you, especially if you have a landlord who doesn't fix anything and its all up to you.
Even though buying a home can be a steep investment upfront, with the loan amount, points, down payment, appraisal and application fees if there are any, these fees are usually recovered after the first 3 years, that is why i said at least 3 years up above. With that being said, each year your home should go up in value, usually about 3 percent on the average, but depends on the area you live in and also depends on the economy right now. Some areas are starting to move forward and go up in value, some are remaining neutral, and alot are below value owning more on their homes than they are worth, due to the foreclosure crisis.
This is another good reason to buy, housing prices are very low right now and you can get a good home in a good area for alot less than you could 2 years ago. When housing prices start moving up again, the values will rise back up and you could end up with alot of equity in your home, which makes for a great investment! Just make sure you research the area your interested in. Call a local realtor in the area that has some good feedback (testamonials), this will tell you just how good they are with their clients. Ask the realtor their opinion of the area, the schools, the values and prices of the homes. Way all your options and take it from there.
Happy House Hunting!