Did you know? According to the latest data from the National Association of REALTORS® (NAR), median rental prices have reached their highest level ever recorded across many parts of the country. In fact, this report found that rental prices have increased by 8.1% as compared to this same time last year. Typically, rental prices fluctuate by 1% from month to month. However, in May and June 2021, rental prices increased by 3.0% and 3.2% from each month to the next, respectively. Needless to say, now may be the time to consider a home purchase if you are a renter that is experiencing these rising rental costs.
Monthly rents are higher than monthly mortgage payments
According to the NAR, even though monthly mortgage payments are rising due to increasing home prices, they are still considerably lower than average rental payments across the country. The latest report from the NAR indicates that the median monthly mortgage payment is $1,204. By contrast, the median monthly rental amount across the country is $1,575.
When analyzing rental prices over time, we see that rental prices have consistently increased over time since 1988. Therefore, it is safe to assume that these rental prices will continue to increase over time. By contrast, buying a home with a fixed-rate mortgage provides stable housing costs. Of course, there are other expenses that come with home ownership though. With this said, you should also be able to accumulate home equity over time, assuming home prices appreciate in the future.
In closing, it is important to remember that home ownership is one of the best forms of wealth accumulation. More often than not, home owners accumulate wealth at a faster pace than renters. As we have mentioned in previous articles, the South Florida housing market is expected to remain strong for the foreseeable future and should continue to be one of the most desirable locations in the country for Americans. Add in historically low mortgage interest rates and this is indeed still a good time to consider a home purchase.
Are you looking to buy or sell a property in South Florida? Now more than ever, it is critical to have a qualified real estate team and the proper search tools behind you. At Live South Florida Realty, Inc., we have been a leader in the South Florida market for many years. Let our team of professionals assist you with buying or selling your piece of paradise today! In addition, our recently launched “Florida Home Search” app is now available on the Apple App Store and Google Play Store. With real-time MLS feeds, this app lets you set your own alerts to notify you as soon as a property meeting your needs hits the market. Furthermore, it will also let you know of recent closed sales in your area so that you may be even more educated on the market. Be sure to download this app for your smartphone or tablet today!