I Want To RENT For A YEAR Then BUY

I Want To RENT For A YEAR Then BUY

                                                                                       

Image title

                                                                          A comment I have been hearing lately is "I think I'll RENT now and BUY in a YEAR"

While I understand this sentiment, it might be a costly decision over the long haul. The most common thing these people say is "I want to learn the areas before I buy". I get that but it may be a costly plan. Let's use a few assumptions and play this out financially. 

You want to rent a 3/2 home with a garage in an assumed target area. Let's choose Circle C. You can expect the average rent to be about $2,350. ($2,350 x 12 = $28,200)

Now let's look at a home for sale in Circle C at $377,000 (today's price)  and you can do 20% down. By my calculations (rough estimate) your monthly payment would be about $2,250 including principle, interest, taxes & insurance.

So now you rent for a year and the Austin market remains on it's current path (8%-12% increase). The same house that was $377,000 will be about $415,000 a whopping increase of $37,700 at 10% year over year increase. Now again assuming interest rates stay the same at about 4.125 (which most doubt) your monthly payment would be about $2,400 per month or an increase of about $150 per month for 30 years! ($54,000 )


So lets' recap. You spent an extra $28,200 on rent and your payment went up $150 per month  by waiting a year. That's almost like throwing away $30,000! Heck, there is a good chance that if you decided you didn't like the place you bought in the first place you could sell it in a year and not loose money even after expenses.


Morris "Bill" AustinREALTOR® ~ Austin Texas Metro

512-709-6343 or [email protected] ~ Text ~ Email ~ Call

Serving Sellers and Buyers full time since 2007

Team Price Real Estate ~ 512-213-0213





Bill Austin Headshot
Author:
Phone: 512-709-6343
Dated: April 26th 2017
Views: 111
About Bill: ...

Property Search








RSS Feed

View our latest blog posts in your RSS reader. Click here to access. RSS

Search Blog

Recent Blogs

903 Turtle Creekk Bld Austin Tx 78745 - Open House Saturday August 18,
5 Clever Ways To Repel Mosquitoes Without Killing Your Outdoor Vibe - 5 Clever Ways to Repel Mosquitoes
How To Make A Small Living Space Look Larger - Wish your living room were 50
Awesome Austin Area Schools - The Greater Austin Area is home to

Saved Properties

This is a list of your favorite properties. We will email you if a property is reduced or leaves the market.

Click 'Save' to add a property to this list.

Register / Login

New & returning visitors please enter your information to login.

By clicking 'register' you are agreeing to our terms of use & giving us expressed written consent to contact you.

Questions? Comments? Complaints?

This message will go directly to the head of our team.

Location & Address

Team Price Inc.
7320 N Mo-Pac Ste 305
Austin, TX
512-270-7326
888-643-9502