The rental market continues to be strong in Huntersville and surrounding communities around Charlotte, NC. The cost of renting continues to go up. The question is: Rent or Buy?
Factors to Consider
- Circumstances: Do you like the flexibility of changing where you live? Moving to new areas? Maybe renting is a better option for you.
- Finances: Are you concerned that your finances may change? Do you like the flexibility of reducing your monthly living expenses? Then again, renting gives you that option whereas a fixed mortgage does not.
- Cost of renting versus buying: Compare the costs of renting a home versus a mortgage payment. But don’t forget to factor in about 1% of your initial investment for annual maintenance if you own.
- Appreciation in value: Look at the overall economic health of the area. Are people moving in and is the area experiencing growth? Then likely your home will appreciate in value.
- Emotional factors: Do you like the idea of owning a home, the freedom to paint walls in whatever colors you choose, customizing your space? Then you may be ready to buy.
The Price to Rent Ratio
By taking the average list price of homes in your city and comparing that to the annual cost to rent you can see which is likely to make more sense in your location.
For example, in the city of Huntersville, NC the average list price of a home in the range of 2100-2400 square feet over the past 6 months* was $250,000. The average rental for a similar home over the past 6 months* was $1600. If I multiply $1600 by 12, the annual rent is $19,200. Then by dividing $250,000 by $19,200 the price-to-rent ratio is 13. A price-to-rent ratio below 15 favors buyers, between 15 and 20 there is no clear winner and a price-to-rent ratio over 20 favors renters. *Based on CMLS data as of 2/5/2016
Click on the links to compare the cost of current rental homes available to current listings (priced from $200,000 to $300,000) in Huntersville:
The Kradel Team