A new survey by Freddie Mac says 70% of renters feel renting is more affordable than home ownership, and 55% plan to keep renting during the next three years.
The survey found those numbers are similar across demographic groups; 70% of Millennials, 61% of Gen Xers and 73% of Baby Boomers think renting is more affordable for them.
In running the numbers for a variety of financial scenarios; this is simply not the case, as you can see by the example graphic based on Millennial averages (below).
One bedroom apartments in Denver average $1,256 rent monthly, and two bedroom apartments average $1,689 rent monthly.
That’s money you’ll never see again when it could be put toward equity; an asset to purchase your ideal home.
So what are the reasons for these false renting perceptions and the perceived home-buying roadblocks?
A common misconception is that 20% is required for a down-payment – which is not the case.
There are loan programs as low as 3-5% down and options to keep rates and other fees low.
Not wanting to commit to a high maintenance house or a location during a transitionary time is understandable.
Buying a condo is a great fit for minimal upkeep, and owning for just 2 years can save you thousands of dollars.
Get a roommate and split the cost of a lower mortgage payment instead of higher rent.
Debt or Income.
There may be hurdles to overcome with debt or salary, but that doesn’t mean it’s impossible to buy. We have suggestions!
While lack of inventory is an issue in the Denver metro area, it’s not impossible to find a place that fits your needs.
We see listings posted daily by our Real Estate colleagues, and with the help of the right agent, the housing market is much easier to navigate. We know agents all over the state of Colorado!
Takeaway: As property values in Denver continue to rise, so will rent.
Remember, a landlord can increase rent every 12 months, and only needs to give 60 days notice of the price increase.
Buying is cheaper – plain and simple, even for a temporary living situation. And your home value will most certainly go up!
The easiest way is to get answers to your questions is to schedule a quick conversation with Michael Shotnik and find your best solution.
Average Millennial Denver Salary – 39,492
House 150 (condo), avg salary, avg one-bedroom apt rent, down payment 5.75%