Higher material costs are an important factor causing a decline in housing affordability. There’s been a hike in building materials like steel, concrete, and gypsum prices. The increase in the price of lumber has been widely reported to be skyrocketing, with lumber prices up by 300% since April 2020. The rising cost of materials has led to an expected increase in the interest rate and driven up the price of single-family homes and apartments.
Beyond the hikes in prices, another factor affecting how you can afford a house is the volatility of building materials. As a result, housing affordability is declining, and residents have to explore other housing options to meet their needs. Our previous post mentioned how Phoenix has the fourth-worst affordable housing shortage in the country for households with meager incomes (according to National Low Income Housing Coalition’s (NLIHC) Gap report). In this blog post, we’d discuss why rent seems a viable option for households compared to buying a house.
Higher Material costs and The Rent Solution
The American Social dynamic places more value on homeownership rather than renting a house; still, we should be quick to understand that times have changed and that Renting a home is gradually becoming a modern solution. Here’s why
- Predictable Expenses: Renting a home gives you a sense of predictable expenditure at the end of the month. You know how much you’re paying, and there are no sudden repair costs that will be accrued to you. While Mortgage Payment might be less than your monthly rent, there are a bunch of financial obligations that come with owning a house, realtor fees, closing costs, homeowner association fees, property taxes, to mention a few.
- Flexibility: Renting a house gives you flexibility in choosing where you want to live, while buying a home reduces your options to places within your financial bracket. If you also feel living in a particular part of town doesn’t work for you anymore, you could also decide to move else; homeowners aren’t able to easily afford this luxury.’
- Immune To Market Dynamics: Renting a house makes you immune to concerns like decreasing the market value of your property. So when property prices fluctuate, Homeowners feel the impact more than renters.
- Amenities: Renting a home sometimes gives you access to amenities like a swimming pool or fitness center that is part of the rent package and won’t require extra pay. Installing these amenities in your home might cost a considerable amount.
- No Maintenance or Repair Costs: Homeowners are responsible for all repair and maintenance costs on a property. Unlike homeowners, renters do not bear any expense for the house; if there are any defects, the tenant calls the landlord, and the repairs are done at no cost to the tenant.
Bottom-line, In deciding whether to rent or buy a home, you should consider your financial health, goals, and situation. is it something your family would like. It’s also noted worthy of talking to a real estate solutions company like EZ Max Offer. They are geniuses at selling homes and making the process as seamless as possible.