Watch the original video: June 2020 Mortgage Update - Low Rates / Owning Vs. Renting
Mortgage Rates
Currently mortgage rates are unbelievably low and two out of three Americans, that own a home right now, can likely refinance. If we haven’t already talked or we talked before, we should probably run numbers again to see if we can help save you money. We anticipate seeing low rates for a while, however, you never know how long these great rates will last.
The Market Right Now
Currently the median home price in Shasta County is $281,632. Shasta county is still relatively low in comparison to other counties in California. Looking at the Real Estate Report Card, in my video, you will see that the amount of first time home buyers anticipated to come onto the market in 2020 is around 1,301. Compare that number to the actual homes being built, which is 401, it illustrates that we continue to have an inventory problem. Many buyers are finding themselves in multiple offer situations when putting an offer on a home, due to the shortage of homes available.
Renting vs. Owning
As of right now there are about 71 thousand renters in our county and of that number 18 thousand of them are eligible to own a home. Let’s take a look at the numbers when you own vs. when you rent.
If you were to buy a home around $281,000, in today’s market, you would probably pay around $1,724 per month, with a minimal down payment. That same house could rent for about $1,575. Fast forward 9 years and the rent could go up to $2,327 a month while the mortgage payment would stay at the $1,724 per month. The difference in cash flow over that 9 year period gives you a savings of around $18,958, if you owned instead of rented. Also, that home could have a estimated net gain of $219,712 for the buyer in this example. In the long run it is definitely more beneficial to own than rent.
If you have any questions about these topics or anything else real estate related, please give me a call.