The true cost of renting in Corsicana, Texas
I'm sure this doesnt come to a suprise...
Just as home prices have gone up over the last year - you’ve likely noticed rent prices have increased right along with them.
And unfortunately for renters - there is not a statewide law that places limits on how much a landlord can increase rent when a lease is renewed.
In the last 90 days here in Corsicana, Texas rent is averaging $1400 / month for your basic 3 bedroom 2 bath home. Some we are seeing as High as $2,000 and as low as $1,000.
Now why are we talking about this ?
Because we are having these discussions constantly with renters who are looking to become homeowners.
Now both renting and buying have their financial advantages and owning a home isn’t the right decision for everyone. We discuss all of this with our clients.
However, the biggest eye opener is the amount of money you are throwing away month after month.
You rent a home for 5 years at $1400 /month with a 5% increase year over year.
Year 1: $1,400 x 12 = $16,800
Year 5: $1,701 x 12 = $20,412
= $92,808 you have paid a landlord and you are left with nothing to show for.
Now lets say buy a home at $250,000 At a 5% Interest rate and a yearly appreciation of 3% over 5 years. [ not accounting for taxes and insurance. And no improvements to the home]
Year 1: $1,342 , Home Value $257,500....
Year 5: $1,342, Home value $289,400
= $31,940 is the money you have built by doing nothing more than maintaining your home and the market appreciating at a steady pace + a ballpark of $61,000 has gone towards your principal.
= 189,000 equity !
This the breakdown we are showing our clients. We know home buying is a huge commitment and right now is not always the right time for everyone.
Therefore we know the importance of showing you everything that goes into buying a home - down payment, closing cost, appreciation, what the market is doing, how to put together the best offer to fit your needs + situation.
So chat with us if you’ve ever thought about becoming an homeowner, schedule a time to developer your strategy session and learn about the market.