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Buying Is 35% Less Expensive Than Renting

Buying a Home is 35% Less Expensive than Renting! | Keeping Current Matters Homeownership remains cheaper than renting with a traditional 30-year fixed rate mortgage throughout the 100 largest metro areas in the United States.

The updated numbers actually show that the range is from an average of 16% in Honolulu (HI), all the way to 55% in Sarasota (FL), and 35% Nationwide!

The other interesting findings in the report include:

  • Interest rates have remained low and even though home prices have appreciated around the country (3.9%), they haven’t greatly outpaced rental appreciation (3.7%). “In the past year, these two trends have made homeownership even more affordable compared with renting.”
  • Some markets might tip in favor of renting if home prices increase at a greater rate than rents and if – as most economists expect – mortgage rates rise, due to the strengthening economy.
  • Nationally, rates would have to rise to 10.6% for renting to be cheaper than buying – and rates haven’t been that high since 1989. 

Bottom Line

Buying a home makes sense socially and financially. Rents are predicted to increase substantially in the next year, so lock in your housing cost with a mortgage payment now.

Just Sold! 4 Fellowship Circle #SantaBarbara

4 Fellowship Circle #SantaBarbara

Freshly remodeled 3 bedroom/ 2 bathroom home on top of the Mesa with amazing views. Gorgeous designer interior features soaring open beam ceilings and great flow to outdoor entertaining decks and patios.
Sold for $1,245,000

Advice on #Homeownership Hasn’t Changed in 200 years

This Advice on Homeownership Hasn’t Changed in 200 Years | Keeping Current Matters Last month, we reported that billionaire John Paulson believes in the financial advantages of homeownership. He has often repeated:

"I think, from an individual perspective, the best deal investment you can make is to buy a primary residence that you're the owner-occupier of.”

However, he has not been the only billionaire to give such advice. As a matter of fact, that same advice has been given by people of wealth throughout the history of our nation.

Here is a quote often attributed to Theodore Roosevelt, 26th President of the United States and billionaire real estate developer:

“Every person who invests in well-selected real estate … adopts the surest and safest method of becoming independent, for real estate is the basis of wealth.”

Andrew Carnegie, one of the richest entrepreneurs in American history said:

“90% of all millionaires became so through owning real estate.”

Bottom Line

If the same advice has been given by the wealthiest people in each era of our country’s history, perhaps we should take it.

Just Listed! Ocean View Beach Condo!

LivingRoom 4700 Sandyland Road #59, Carpinteria CA

Calling all beach lovers! Rare opportunity to own a turn-key vacation rental at the beach with great ocean views! 2BD/1.5BA upstairs end unit is fully furnished, sleeps 6 and features remodeled kitchen and bathrooms, wood floors, view balcony and in-unit laundry. Resort-style amenities include 2 pools, hot tub, club house, gated parking and on-site rental-management staff. Adjacent to pristine beaches, wildlife estuary, dining and shopping. Only 5 min. to Rincon surfing, 10 min. to Santa Barbara, 40 min. to wine country and 90 min. to downtown Los Angeles.

Offered At $949,000
 MLS# 15-1600
DiningKitchen BedRoom2 BedRoom Beach Balcony DSC00364 labeled Solimar Sands

#RealEstate Remains #BestInvestment

Billionaire money manager John Paulson was interviewed at the Delivering Alpha Conference presented by CNBC and Institutional Investor. During his session he boldly stated:

"I still think, from an individual perspective, the best deal investment you can make is to buy a primary residence that you're the owner-occupier of."

Paulson is the person who, back in 2005 & 2006, made a fortune betting that the subprime mortgage mess would cause the real estate market to collapse. He understands how the housing market works and knows when to buy and when to sell.

Paulson breaks down the math of homeownership as an investment:

"Today financing costs are extraordinarily low. You can get a 30-year mortgage somewhere around 4.5 percent. And if you put down, let's say, 10 percent and the house is up 5 percent, which is the latest data, then you would be up 50 percent on your investment."

How many are seeing a 50% return on a cash investment right now?

Paulson goes on to compare the long term financial benefits of owning verses renting:

Just Sold! 4917 El Carro Lane, Carpinteria

Twilight 4917 El Carro Lane, Carpinteria CA 93013

Just sold with multiple offers over asking! Stunning newer single level home close to downtown & the beach. Large gourmet kitchen w/top-of-the-line appliances flows into great room living/dining area w/soaring ceilings, gas fireplace & bountiful natural light. Sumptuous master suite features gas fireplace & en-suite bathroom w/soaking tub, dual vanity and walk-in closet. Lush, landscaped backyard w/patio perfect for enjoying the weather!
Sold for $1,175,000

MLS#15-1238

LivingRoom Kitchen MasterBedRoom MasterBathRoom Patio BackYard2

There’s No Place Like A #SantaBarbaraHome

There’s No Place Like Home | Keeping Current Matters Last week, we reported on the financial reasons purchasing a home in today’s market makes sense. The Joint Center for Housing Studies at Harvard University performs a study every year surveying participants for the reasons that American’s feel are most important in regards to homeownership.

The top 4 reasons to own a home cited by respondents were not financial.

1. It means having a good place to raise children & provide them with a good education

From the best neighborhoods to the best school districts, even those without children at the time of purchasing their home, may have this in the back of their mind as a major reason for choosing the location of the home that they purchase.

2. You have a physical structure where you & your family feel safe

It is no surprise that having a place to call home with all that means in comfort and security is the #2 reason.

3. It allows you to have more space for your family

Whether your family is expanding, or an older family member is moving in, having a home that fits your needs is a close third on the list.

4. It gives you control over what you do with your living space, like renovations and updates

Looking to actually try one of those complicated wall treatments that you saw on Pinterest? Want to finally adopt that puppy or kitten you’ve seen online 100 times? Who’s to say that you can’t in your own home?

The 5th reason on the list, is the #1 financial reason to buy a home as seen by respondents:

5. Owning a home is a good way to build up wealth that can be passed along to my family

Either way you are paying a mortgage. Why not lock in your housing expense now with an investment that will build equity that you can borrow against in the future?

Bottom Line

Whether you are a first time homebuyer or a move-up buyer who wants to start a new chapter in their life, now is a great time to reflect on the intangible factors that make a house a home.

Housing Price Update

po Three major drives of home prices seem to support current and rising home price levels.

  • Jobs:  The U.S. continues to add jobs.  Real estate and jobs vary together.  A growing economy helps home sales.
  • Households:  Home sales were slightly under their year 2000 level in 2014, but the United States added an additional 17 million households over the intervening time period.  As the millennials mature their demand for apartments is expected to decline as they move into homes.
  • Housing Supply:  The country needs to add 1.5 million housing units a year to accommodate population growth and housing demolitions.  However, housing additions have recently been under 1 million a year:  there are fewer available homes, which is a positive for home prices.