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August 5th, 2015 at 10:00 am

buy a home now in So Cal

Rents are up in Southern California. So are home prices. You want a place of your own, but aren’t sure if you should buy or rent. What’s your best course of action?

Good question, but finding the right answer takes some digging. First, some statistics:

Rentals

Purchases

Most everyone knows the advantages of buying over renting: Equity that builds over time. A safeguard against inflation. Tax-deductible mortgage payments. The satisfaction of living in a home that you can improve or modify to your liking without worrying about a landlord.

But coming up with a down payment, qualifying for a loan, and finding a suitable home in the neighborhood of your choice can be setbacks to ownership. So here are few things to consider when weighing one option against the other:

Deciding between the flexibility of renting and the potential long-term reward of homeownership is on the minds of many would-be buyers. Jed Kolko, chief economist at Trulia, creates the Rent. vs. Buy Index for 100 U.S. markets. By factoring in home prices, rents on comparable apartments, interest rates, tax deductions, and other variables, he computes the difference between the costs of buying vs. renting.

Last February, he forecast that buying would be 24 percent lower than renting for the typical household in Los Angeles County over seven years. In Orange County, it would cost 21 percent lower. But, he pointed out, home prices have been rising faster than rents, and the next time he analyzes the numbers, he predicts those figures will be smaller.

Want to take a stab at crunching the numbers yourself? This interactive calculator from realtor.com examines the most important costs associated with buying a house and computes the equivalent monthly rent.

Whether still you’re on the fence or ready to start the ball rolling toward homeownership, it’s always worth your while to connect with a great real estate professional.

 

 

 

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