With the recent increase in mortgage rates some people might be tempted to think that renting is better than buying. However with all things considered, industry experts still believe that buying a home is a better option.
According to Forbes.com, although there has been a slight increase in interest rates they are still historically low. Rent prices have been on an upswing in recent months while home prices are still considerably low due to the burst in the real estate bubble. Therefore the slight interest rate increase will have little affect on the rent versus buy calculations.
They were able to determine that although interest rates should continue to rise, buying will not become too expensive until interest rates are above 10.5%. Using the latest Freddie Mac interest rate of 3.9% for a 30 year fixed mortgage as well as a host of criteria they were able to determine that buying a home at that interest rate is 41% cheaper than renting nationally.
If you’re considering buying a home and you’re unsure how much you can afford I have a few tools on my website tomhealy.com to help you get started. I can also guide you throughout the home buying process in Philadelphia and South Jersey. Give me a call at 856.906.7313.
