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What is Currently the Best Real Estate Investment: Rent Vs. Buy
Over the past 3 years, the real estate market has undergone a great deal of change. Home values nationwide have fallen as a result of the housing bubble, and widespread foreclosures have kept prices low and flooded the market with available properties.
But as home prices have fallen, the cost of rentals has risen dramatically in almost every state. Nationwide, the cost of rent has already increased 60% since 2008. Analysts currently predict that by the end of 2011 that figure will rise another 4.5%, and by at least another 3% in 2012. So what's behind this dramatic increase?
Experts point to several reasons for the increase in rental costs, but the main reason is that rental properties are simply in higher demand. After the world economy became sunk in recession in late 2008, home sales plummeted. Many buyers decided that it was better to rent properties and wait out the storm than it was to buy them. No one was sure how low housing prices would fall, and that trend continued over the years, resulting in more people looking to rent. In addition, buyers who had bought property for high values before the crash found themselves unable to sell their purchases for anywhere near what they paid. As a result, they turned to renting their investments at higher rates to both pay off their mortgage and earn profit on their investment.
So what does this trend mean for today's potential homebuyers?
The fact is, with home values low and rental costs high, its the perfect time to stop throwing money away on rent and buy your own home. With banks offering mortgages with historically low interest rates, many buyers are finding that they can actually buy their own property and pay less on their monthly mortgage payments than they would in rent.
If you're an investor, buying now offers a double bonus. Not only is it easy to find low prices on a home, apartment, condo or commercial property, but you can turn around and rent it for a high monthly value. Experts agree that while housing prices are low now, they won't be forever. Many in the field believe prices are already starting to climb, and in many areas the market has reached its bottom. And while you wait for your investment to appreciate in value, you can put your investment to work by renting it and watch it pay for itself.
But the best way to take advantage of today's real estate market is to invest in it's most valuable commodity: the foreclosure homes. Foreclosure properties offer the lowest prices available on real estate available anywhere and there are currently higher levels of foreclosure properties out there than there have been in many years. These homes sell for 10%, 25%, and often 50% off their actual market value. And with a flooded market, investors are seeing incredible deals at almost every auction.
As you can see in the info graphic, the difference is clear. Taking advantage of the gap between rental costs and home values can save you money, whether you're buying your first home or investing for the future. Explore foreclosures in your state today to see the deals available to you. There's plenty out there, and with our help, you can invest in a fantastic property that will earn for you for many years to come.
Rent VS Buy Calculator
This calculator helps organize information for users to understand what may be a better solution when it comes to living expenses, and what may give better results when it comes to living cheaper.