As a renter, you’re faced with a big decision every year: renew your lease, start a new one, or buy a home. Before you make any decisions, it’s essential to understand the actual costs of renting in the long term.
Realtor.com reports that 74.2% of renters who moved in the last 12 months saw their rent increase, and 63.2% of those who renewed their lease also experienced a hike in rent. This is unsurprising considering the consistent rent increase since 1988, according to the Census.
Realtor.com’s 2023 Housing Forecast indicates that rent costs will continue to rise, with a projected increase of 6.3% in the year ahead.
While it may not be as significant as the previous two years’ increases, it’s still higher than the historical average for rent hikes between 2013-2019.
If you’re considering renting again in 2023, you may pay more than expected. Homeownership is a great alternative that provides stability and a fixed monthly cost. Unlike rental payments, which can increase over time, a fixed-rate mortgage lock in your monthly payment for the loan’s duration, allowing you to budget wisely and plan for the future.
Additionally, homeownership builds home equity, which renters do not have. According to CoreLogic’s latest Homeowner Equity Insight report, the average homeowner gained $34,300 in equity over the last 12 months.
In conclusion, if you’re thinking of renting this year, it’s essential to understand the long-term costs involved. Consider the benefits of homeownership and chat with me to discuss how you can start your journey towards owning a home today.