The Continuing Struggle of Renting vs. Buying
Tampa’s real estate has been on the rise, and 2020 will be no exception. Housing is not only projected to increase, but because the baby boomer segment is transitioning into assisted living, smaller homes are expected to rise in the market. At a time when real estate is an excellent investment opportunity, is it time to be renting or buying? If Tampa is such a hot market, why are so many people still renting homes instead of buying a home?
Renting is Currently More Expensive
In Tampa, renting an apartment will cost you an average of $1,300 per month. Many students report paying $700 for a room (with bathroom) in a 4×4 apartment, which means the total rent is $2,800. With low interest rates on mortgages holding steady, purchasing a home can cost as little as $1,000 per month (with insurance). In a simple comparison, if you qualify for a mortgage loan and you already know which neighborhood you would like to plant your roots, then buying a home is definitely your best option. However, not everyone wants to plant their roots. Welcome to the new generation of home buyers who are trying trying to pay off their student loans and find a job. They are not evening thinking about buying a home.
The Millennials are moving, a lot
Trending within the Millennial generation is the ability to move around. Freedom they call it. Paying more money for apartments all over the Tampa Area just so they don’t “settle down” too quickly. In fact, home ownership is the lowest it has been in over 50 years in the Tampa Bay Area! That is a pretty significant number. In addition, some of these newly-graduated Millennials are still struggling to find decent jobs and as such have not moved out of their parent’s spare room to their own home. Home-ownership is no doubt a tell-tale sign up our economy.
We won’t forget 2008
And neither will the younger generation who witnessed what their parents endured through the massive home foreclosures and job losses. The stench of a down-trodden economy still lingers in the air, making young adults more cautious of such a big decision. CNBC sums it up perfectly:
“People’s monthly student loan payments can eat up a large slice of their income, threaten to push down their credit scores and make saving nearly impossible — all huge impediments, of course, to landing in a house.”
Sources:
https://www.cnbc.com/2018/04/19/student-loan-debt-can-make-buying-a-home-almost-impossible.html
