Renting a Columbia SC house used to be a popular choice over buying because it was cheap. Today, 1 out of 3 people pay rent for a 3-bedroom home that is more than 30% of their monthly median income, according to RealtyTrac. So why do people continue renting a Columbia SC house instead of buying, you might ask?
Years of economic uncertainty have scared many potential buyers. With that, the demand for rentals has skyrocketed, while the cost to rent has done the same. With renting costs so high, people are left having to cut back spending on food, health care and retirement.
Renting a Columbia SC House and Wondering if You're Paying Too Much?
It's recommended you allocate no more than 30% of your total household income towards renting a Columbia SC house or apartment. If you're currently renting and curious as to the average other renters in your area are paying, take a look at RentOMeter.com. All you have to do is type in your address, how much you pay per month and the number of bedrooms. In a matter of seconds, you'll see what the average rent is within a certain distance from your home, based on the number of bedrooms. With that, you can better gauge how good (or bad) of a deal you're actually getting for what you're paying.
If you've already signed on the dotted line for your lease, there's not much you can do to get out of your lease. However, if you're just starting to look for a new home, use the RentOMeter website to get a better understanding of what typical rental costs are for renting a Columbia SC house before you actually look at individual properties. You can try to use the figures as a bargaining piece and possibly lower the monthly payment.
While it has become increasingly more expensive to rent, you might consider buying a home. If you need help trying to decide if it's more feasible for you to continue renting a Columbia SC house, or looking at possible ownership, contact us and we'll be happy to sit down with you and "run the numbers" for you to see which makes the most sense for your individual circumstances.
Visit our Columbia SC Homebuyer Tips section of articles under our Columbia SC Real Estate Categories to the right for tips on buying a Columbia SC home.
Buying a Columbia SC home instead of renting pays off, on average, in about three years. That’s a national average, but seems to hold true in most markets across the nation. This, according to a new analysis from real estate website Zillow.com.
The analysis that Zillow calls the “break even horizon” compares what it costs to buy or rent the same home in a number of U.S. markets over time. Of course, the rent versus buy calculations will vary depending on where you live.
Break Even Point for Buying a Columbia SC Home
In some markets, the break even point is 4 to 5 years, but in other areas, buying a home wins out in less than 2 years. There are wild markets where residents must wait up to 14 years for buying to make more sense than renting.
The analysis takes into account a host of factors potential buyers should think about when considering the leap, including the down payment, mortgage and rental payments, buying and selling costs, property taxes, utilities, maintenance costs and tax deductions. The analysis adjusts for inflation and forecasts home value and rental price appreciation.
The new study on the old “rent-versus-buy” debate comes at a touchy time for the housing market. Many analysts believe a housing bottom has already been reached but don’t expect a return to the days of the real estate bubble. There is already some concern about the strength of the recovery, with home sales slowing in June as inventory remained tight and buyers paid higher prices.
However, rents are also rising, and housing affordability is at or near record levels, and mortgage rates remain very low, for those who can qualify. The combination of these factors are prompting many renters to consider buying a Columbia SC home instead of continuing to subsidize their landlord’s retirement.
When trying to decide if buying a Columbia SC home instead of renting is best for you, decide how mobile you’ll be, your financial situation, marital status, career goals, and your personality. In other words, are you more likely to never want to do maintenance or yard work? If so, renting may be your best option.
If you’re trying to decide whether buying a Columbia SC home would be your best move, talk to us. We can help you decide which option best suits your lifestyle and your pocketbook.
If you are in the unfortunate financial position where you are losing your Columbia SC home due to foreclosure or short sale, your credit score is probably going to take a pretty hard hit.
In “normal times,” this could make it really tough to rent your next place of residence. Luckily, these are not “normal times” and most landlords are understanding of renters’ financial distress.
Losing Your Columbia SC Home, Better Days are Within Reach
Whether you believe it right now or not after losing your Columbia SC home, better days are within reach. To prepare for those better days take steps now to minimize the damage to your credit, your rental prospects and your future.
Just because you are defaulting on your mortgage, don’t default on other bills. You still need to pay your cell phone, cable TV, car loan, etc. while you are in the process of working out the details of losing your Columbia SC home.
Each additional account you default upon will further hurt your credit score, so keep up the payments if you can.
Losing Your Columbia SC Home? Consider a Short Sale
Rather than just losing your Columbia SC home to foreclosure, consider a short sale, which will do less damage to your credit score. A short sale will allow you to relinquish your debt in writing as well as get rid of uncertainty and stress. Negotiating a short sale should give you much better chances as opposed to just letting it go to foreclosure.
Banks are also very open to short sales these days and working with the bank should bring the best outcome to everyone. Your new landlord will also highly value the fact that you tried to mitigate damages by doing a short sale and taking care of your property during the process.
Never Get an Eviction
Lastly, don’t ever get an eviction on your record. If you are losing your Columbia SC home to foreclosure, work with the lender for an orderly move out. It might be nearly impossible to explain to a potential new landlord why an eviction should be overlooked by them.
When looking for a new place to rent, explain your situation and how you only defaulted on your house but not any other responsibilities. Tell them how you handled it maturely and left the house in good condition. Provide the landlord clear evidence that you will take care of their property as well. Doing these things will give you the best chance of being approved for the rental.
Renting after losing your Columbia SC home is much easier these days than in the past. Being professional and responsible, in all aspects of what undoubtedly will be a painful and uncomfortable process, should allow you to find a new place to rent and hopefully start to rebuild your creditworthiness.