IsItBetterToRentorBuyaHome?
You’veprobablyaskedyourselflately:Isitevenworth tryingtobuyahomerightnow?
Withhighhomepricesandstubbornmortgagerates, rentingcanseemlikethesaferchoicerightnow.Or maybeyouronlychoice.That’saveryrealfeeling.You shouldonlybuyahomewhenyou’rereadyandableto doit,andifthetimingisrightforyou.Buthere’sthe thingyouneedtoknowaboutrenting.
Whileitmayfeellikeasaferbettoday–andinsomeareasmightevenbelessexpensivemonthto-monththanowning–itcanreallycostyoumoreovertime.Infact,arecentBankofAmerica surveyfound70%ofaspiringhomeownersworryaboutwhatlong-termrentingmeansfor theirfuture.Andthey’renotwrong.Owningahomemayseemwayoutofreach,butifyoumake aplannowandsteadilyworktowardit,homeownershipcomeswithseriouslong-term financialbenefits.
HomeownershipBuildsWealthOverTime
Buyingahomeisn’tjustabouthavingaplacetolive–it’sasteptowardbuildingyourfuture wealth.Why?Homepricestypicallyriseovertime,whichmeansthelongeryouwait,themore expensiveitistobuy.Andeveninsomemarketswherehomepricesaresofteningtoday,the overalllong-termtrendspeaksforitself(seegraphbelow):
Andashomevaluesrise,sodoesyourequitywhenyou’reahomeowner.That’sthedifference betweenwhatyourhomeisworthandwhatyouowe.So,witheverymortgagepayment,that equitygrows.Overtime,thatbecomespartofyournetworth.
Today,theaveragehomeowner’snetworthisnearly40Xgreaterthanthatofarenter That’sashockingdifference,andthedollarsinthevisualbelowdon’tlie(seegraphbelow):
Andit’soneofthebigreasonswhyForbessays:
“Whilerentingmightseemlike[the]lessstressfuloption...owningahomeisstillacornerstone oftheAmericandreamandaprovenstrategyforbuildinglong-termwealth.”
TheBiggestDownsideofRenting
So,short-term,whydoesrentingfeellikeasimplerchoice?Lowermonthlypayments,less responsibility,nostringsattached.Butlong-term?Itcansting.
Fordecades,whilehomepriceshavebeenrising,renthasgoneuptoo.Andwhilerenthas heldrathersteadymorerecently,historyshowstheoveralltrendisupandtotheright.That makessavingforahomemorecomplicatedthanever(seegraphbelow):
Thatkindoffinancialuncertaintyhasarealimpact.InthesameBankofAmericasurvey,72%of potentialbuyerssaidtheyworryrisingrentcouldaffecttheircurrentandlong-termfinances. Becauserentdoesn’tbuildwealth.Itdoesn’tcomebacktoyoulater.Itpaysyourlandlord’s mortgage–notyours.So,whetheryourentorown,you’repayingamortgage.Thequestionis: whosemortgagedoyouwanttopay?
Rentingvs.Buying:WhatReallyMatters
Thinkofitthisway.Rentingmeansyourmoneyisgoneonceyoupayit.Owningmeansyour paymentbuildsequity–likeasavingsaccountyoucanlivein.Sure,buyingcomeswith responsibility.Butitalsocomeswiththekindofrewardthatgrowsovertime.Andthat’swhyyou needasolidplantogetthere.
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Rentingmayfeelmoredo-abletoday.Butovertime,itcouldcostyoumore–without helpingyoubuildanythingforyourfuture.
Ifhomeownershipfeelsoutofreachtoday,you’renotalone.Andthefirststeptowardgetting outoftherentaltrapistosetaplan.Let’sconnect,setyourspecificgoals,andexploreyour options–soyou’rereadywhenthetimeisright.
Householdsworkingontheirbudgetwillfinditmuch easiertocontinuetorentthantogothroughthe expensesofhomeownership.However,theyneedto considertheequityandgenerationalwealththeycan buildupbyowningahomethattheycan’tbyrenting it.Inthelongrun,buyingahomemaybeabetter investmenteveniftheshort-runcostsseem prohibitive.
JoelBerner
WhyYourHomeSearch
JustGotEasier
There’snoarguingthepastfewyearshave beenchallengingforbuyers.Butthere’sonebig brightspottodaythatmakesfindingahomein yourbudgetabiteasier.Andthat’showmuch inventoryhasgrown.
Let’slookattwoareaswherewe’veseenalot moreoptionslately,soyoucanstartdreaming ofthepossibilities.
1.ThereAreMoreExistingHomesforSale
DatafromRealtor.comshowsthenumberofexistinghomesforsale(onesthathavealreadyhad anowner)hasgoneupby30.6%comparedtothesametimelastyear.Andexpertssayyour poolofoptionsisexpectedtogetevenbetterthroughouttheyear.Forecastsshowinventoryis projectedtogrow11-15%bytheendoftheyear(seegraphbelow):
2025For-Sale InventoryForecasts
Thatmeansyou’llhaveabetterchanceof findingahomethatmeetsyourneedsand budgetnowthatinventoryhasgrown.As RalphMcLaughlin,thentheSenior EconomistatRealtor.com,says:
“Itcouldbeaparticularlygoodtimeto getoutintothemarket...you'regoing tohavemorechoice.Andthat'snot somethingthatbuyershavereallyhadmuch overthepastseveralyears.”
DarylFairweather,ChiefEconomistat Redfin,seemstoagree,saying:
“Nowisthebesttimetobuyinthelast twoyears...thereissignificantly moreinventory...”
2.ThereAreMoreNewlyBuiltHomesontheMarket
AccordingtodatafromtheCensusandtheNationalAssociationofRealtors(NAR),28.6%of homesonthemarketrightnowarenewlybuilthomes.That’smorethanthenorm(seecharts below).Butdon'tworry,that'snotbecausebuildersareoverdoingit–it’sjustthatthey’retryingto catchupafteryearsofunderbuilding.
From1983-2019,anaverageofonly13% ofhomesforsalewerenewlybuilt
AsofApril2025,almost30%of allhomesforsalewerenewlybuilt
Source:NAR,Census
Andthebestpartis,sincebuildershavebeenfocusingonsmallerhomeswithlowerpricepoints, youmayactuallyfindoutnewbuildsarelessexpensivethanyou’dexpect.So,whilealotof peoplewriteoffnewconstructionbecauseit’seasytoassumethecostsarewayhigher,lately, thatpricegapisn’twhatyou’dexpect.AsCNETsays:
“Ifyouliveinanareawherethere'salotofnewconstructionhappening...youmightbeableto purchaseanewhouseforapricesimilartoorevenlessthanapre-ownedone.”
Ifyouhaven’tbeenabletofindahomethat’sinyourbudget,it’stimetoaskyouragentaboutnew builds.Ifyoudon’t,youmaybecuttingyourpoolofoptionsbyaboutathird.
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Morechoicesmeansmoreopportunitiesforyou.Reachoutifyouwanttoseewhat’savailable inandaroundourarea.
WhatanEconomicSlowdown CouldMeanfortheHousingMarket
Talkabouttheeconomyisalloverthenews,andtheoddsofarecessionarerisingthisyear. That’sleavingalotofpeoplewonderingwhatitmeansforthevalueoftheirhome–andtheir buyingpower.
Let’stakealookatsomehistoricaldatatoshowwhat’shappenedinthehousingmarketduring eachrecession,goingallthewaybacktothe1980s.Thefactsmaysurpriseyou.
ARecessionDoesn’tMeanHomePricesWillFall
Manypeoplethinkthatifarecessionhits,homepriceswillfallliketheydidin2008.Butthat wasanexception,nottherule.Itwastheonlytimethemarketsawsuchasteepdropinprices. Andithasn’thappenedsince,mainlybecauseinventoryisstillsolowoverall.Eveninmarkets wherethenumberofhomesforsalehasstartedtorisethisyear,inventoryisstillfarbelowthe oversupplyofhomesthatleduptothehousingcrash.
Infact,accordingtodatafromCotality(formerlyCoreLogic),infourofthelastsixrecessions, homepricesactuallywentup(seegraphbelow):
So,don’tassumearecessionwillleadtoasignificantdropinhomevalues.Thedatasimply doesn’tsupportthatidea.Instead,homepricesusuallyfollowwhatevertrajectorythey’realready on.Andrightnow,inmostplaceshomepricesarestillrising,justataslowerpace.
MortgageRatesTypicallyDeclineDuringRecessions
Whilehomepricestendtostayontheircurrentpath,mortgageratesusuallydropduring economicslowdowns.Again,lookingatdatafromthelastsixrecessions,mortgageratesfell eachtime(seegraphbelow):
So,arecessionmeansratescoulddecline.Andwhilethatwouldhelpwithyourbuyingpower, don’texpectthereturnofa3%rate.
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Theanswertotherecessionquestionisstillunknown,buttheoddshavegoneup.However, thatdoesn’tmeanyouhavetoworryaboutwhatitmeansforthehousingmarket–orthe valueofyourhome.Historicaldatatellsuswhatusuallyhappens.
Itisveryreasonablethatbuyersmayfeelhesitantto makeasignificantfinancialdecisionwhilethepath forwardfeelsuncertain.However,homeshoppers canpreparetobesuccessfulbymakingsurethey arelookingathomesthatfitverycomfortablyintheir budget.Iftherighthousecomesontothemarket attherightprice,buyerscanfeelconfident movingforwardwithahomepurchase.
Fromhighhomepricestomortgagerateswings,thehousingmarkethasleftalotofpeople wonderingwhat’snext–andwhethernowisreallytherighttimetomove.Thereisoneplaceyou canturntoforanswersyouwantthemost.Andthat’stheexperts.Theirforecastswillgiveyou clarity–andmaybealittlemoreoptimismthanyoumightexpect.
Whileamajordropisn’tonthetable,forecastersarecallingforamodestdeclineinratesinthe monthsaheadastheeconomicoutlookbecomesmorecertain.Basedontheinformationwe haverightnow,here’salookatwheretheysayratesshouldbebyyear-end(seegraphbelow):
Eventhisslightdecreaseisawelcomechange.Aseeminglysmalldeclinecanstillhelp bringdownyourfuturemortgagepaymentandgiveyouabitmorebreathingroomin yourbudget.
Justremember,everythingfrominflationtoemploymentandbroadereconomicshiftswillhavean impactonwhereratesgofromhere.So,don’ttrytotimethemarket.Anddoexpectsome volatilityalongtheway.
InventoryWillContinueToGrow
Inventoryhasalreadyimprovedalotthisyear.Abigportionofthegrowththemarkethasalready seenisbecausehomeownersaregettingtiredofsittingonthesidelines.Ifrateforecastspanout astheexpertssay,thatcouldbeenoughtotipsomemoresellersoffthefenceandbackintothe market–givingyouevenmoreoptionsforyourmove.
HomePricesAreModerating
Asmorehomeshitthemarket,therewillalsobelessupwardpressureonhomeprices.Expert forecastsarestillcallingforgrowth,butthepaceofthatgrowthisslowingdownasinventory climbs.Theaverageofall7forecastsshowspriceswillriseabout2%thisyear(seegraphbelow):
PercentAppreciationasof5/29/2025 2025HomePriceForecasts
Thatmeansyoucouldfinallygetalittlebitofrelieffromrapidlyrisinghomeprices.Whenyou combinetheforecastforhealthierpricegrowthwithprojectionsforslightlylowermortgagerates, thatcouldmeanmorebuyingpowerinthemonthsahead.
Keepinmind,though,thehousingmarketishyper-local.So,thisiswillvarybyarea.Some marketswillseepriceshigher.Andsomemayevenseepricesdipalittleifinventoryisup significantlyinthatlocation.So,leanonanagentforinsightsintowhat’shappeninginyourarea.
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Let’stalksoyoucangetthescooponwhat’shappeninginourareaandadviceonhowto makeyournextmoveasmartone.
Averageof All7 Fannie Mae
CotalityHPESWells Fargo NARMBAZillow
HowChangingMortgageRates AffectYourMonthlyPayment
Expertssayrateswillcomedownslightlybytheendoftheyear–butsomevolatilityisexpected.
Averagemortgagerateswilldeclinemodestlybutremain above6percent,withlikelyboutsofvolatility.
So,youshouldn'ttrytotimethemarket.Instead,it'sbettertofocuson howevenasmallchangeimpactsyourfuturemortgagepayment.
TheTop2Buyer MistakesRightNow
Intoday’scomplexmarket,you’llwanttobesure youhaveadvicefromateamofprofessionals.If youdon’tleanonthepros,youmaymakesome costlymistakes.Herearethetop2otherbuyersare makingrightnowandhowyouragentandlender canhelpyouavoideachone.
1.BuyingMoreHouse ThanYouCanAfford
It’simportanttoavoidstretchingyourbudget toofar,especiallywhenotherhousing expenseslikehomeinsuranceandtaxesare ontherise.Andoneofthebestwaystogeta goodideaofyournumbersisbygetting pre-approvedbyalenderbeforeyoustart yoursearch.Thathelpsyouknowwhatyou canborrowforyourhomeloan,soyoucan determinearealisticpricepointyou’re comfortableat.Bankrateoffersthisadvice:
“Focusonwhatmonthlypaymentyoucan affordratherthanfixatingonthemaximum loanamountyouqualifyfor.Justbecause youcanqualifyfora$300,000loan doesn’tmeanyoucancomfortably handlethemonthlypaymentsthat comewithitalongwithyourother financialobligations.”
73%faster
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2.MissingOuton AssistancePrograms
Savingupfortheupfrontcostsof homeownershiptakessomecarefulplanning. Youhavetothinkaboutyourclosingcosts, downpayment,andmore.Andifyoudon’t workwithateamofexperienced professionals,youcouldmissouton programsouttherethatcanmakeabig differenceforyou.Thisishappeningmore thanyourealize.
AccordingtoRealtor.com,almost80%of first-timebuyersqualifyfordown paymentassistance–butonly13% actuallytakeadvantageofthose programs.
Talktoalenderaboutyouroptions.Whether you’rebuyingyourfirsthouseoryourfifth, theremaybeaprogramthatcanhelp.
Thegoodnewsisyoudon’thavetodealwithanyoftheseheadaches,ifyouhavetheright partnerbyyourside.Let’sconnectsoyouhaveaprowhocanhelpyouavoidthesecostly mistakes.
ThingsToAvoid AfterApplying foraMortgage
Oncealenderhadreviewedyour financesaspartofthehomebuying process,youwanttobeasconsistent aspossible.
Don’tchangebankaccounts.
Don’tdepositcash intoyouraccounts beforespeaking withyourbank orlender.
Don’tapplyfornewcreditor closeanycreditaccounts.
Don’tco-signother loansforanyone.
Don’tmakeany largepurchases.
Thebestadvice?Onceyou’vedoneyourmortgageapplication,always talktoyourlenderbeforedoinganythingfinancialinnature.
5ReasonsYouNeedanAgent WhenBuyingaHome
Whenitcomestobuyingahome,expertadvicefromatrustedrealestateagentispriceless,now morethanever.Andhere’swhy.Arealestateagentdoesalotmorethanyoumayrealize.
Youragentisthepersonwhowillguideyouthrougheverystepwhenbuyingahomeandlookout foryourbestinterestsalongtheway.Theysmoothoutacomplexprocessandtakeawaythe bulkofthestressofwhat’slikelyyourlargestpurchaseever.Andthat’sexactlywhatyouwant anddeserve.
ThisisatleastpartofthereasonwhyasurveyfromBrightMLSfoundanoverwhelmingmajority ofpeopleagreeanagentisakeypartofthehomebuyingprocess(seevisualbelow):
Ofrespondentsagree"Itwouldbe verystressfultonavigatethe homebuyingprocesswithouta realestateagentorbroker.”
Ofrespondentsbelieve "Arealestateagentorbroker isanessential,trusted advisorforahomebuyer."
1.DeliverIndustryExpertise:Therightagent–theprofessional–willcoachyou througheverythingfromstarttofinish.Withprofessionaltrainingandexpertise,agents knowtheinsandoutsofthebuyingprocess.Andintoday’scomplexmarket,thewayreal estatetransactionsareexecutedisconstantlychanging,sohavingexpertadviceonyour sideisessential.
2.ProvideExpertLocalKnowledge:Inaworldthat’spoweredbydata,agreatagent canclarifywhatitallmeans,separatefactfromfiction,andhelpyouunderstandhow currentmarkettrendsapplytoyouruniquesearch.Fromhowquicklyhomesaresellingto thelatestlistingsyoudon’twanttomiss,theycanexplainwhat’shappeninginyour specificlocalmarketsoyoucanmakeaconfidentdecision.
3.ExplainPricingandMarketValue:Agentshelpyouunderstandthelatestpricing trendsinyourarea.What’sahomevaluedatinyourmarket?Whatshouldyouthinkabout whenyou’remakinganoffer?Isthisahousethatmighthaveissuesyoucan’tseeonthe surface?Noonewantstooverpay,sohavinganexpertwhoreallygetstruemarketvalue forindividualneighborhoodsispriceless.Anofferthat’sbothfairandcompetitiveintoday’s housingmarketisessential,andalocalexpertknowshowtohelpyouhitthemark.
4.ReviewContractsandFinePrint:Inafast-movingandheavilyregulatedprocess, agentshelpyoumakesenseofthenecessarydisclosuresanddocuments,soyouknow whatyou’resigning.Havingaprofessionalthat’strainedtoexplainthedetailscouldmake orbreakyourtransactionandiscertainlysomethingyoudon’twanttotrytofigureouton yourown.
5.BringNegotiationExpertise:Fromoffertocounterofferandinspectiontoclosing, therearealotofstakeholdersinvolvedinarealestatetransaction.Havingsomeoneon yoursidewhoknowsyouandtheprocessmakesaworldofdifference.Anagentwill advocateforyouastheyworkwitheachparty.It’sabigdeal,andyouneedapartnerat everyturntolandthebestpossibleoutcome.
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Realestateagentsarespecialists,educators,andnegotiators.Theyadjusttomarketchanges andkeepyouinformed.Andkeepinmind,everytimeyoumakeabigdecisioninyourlife, especiallyafinancialone,youneedanexpertonyourside.Expertadvicefromatrusted professionalispriceless.
Thecomplexitiesofthecurrentconditions meanthat,nowmorethanever,it’ssmartto leanontheguidanceofanexperiencedlocal realestateagent.Ifyouwanttoenterthe housingmarketin2025,whetherasabuyer oraseller,letaproleadthewayforyou. Bankrate
Doyouhavequestionsabout somethingyoureadhereorabout buyingahomeingeneral?Don’t hesitatetoreachout.
Whetherit’shousingmarket-related, orsomethingaboutyourspecific situation,I’vehelpedotherbuyers findsuccess–andIcanhelpyoutoo.
