Revisiting the Rent vs. Buy Debate

Hi All,
   Happy Columbus Day to you. For those of you who have the day off, congratulations. For those of us working, well, we have to work today!

   Back in June, we covered the much-debated topic of "Rent vs. Buy", and Trulia has released their Rent vs. Buy Index. As Blake Ellis, a staff reporter with CNN Money notes in his article, "Where to buy and where to rent", Trulia is using the following rule to make the Rent vs. Buy determination: If the home price is 15 times higher than the annual rent for a similar property, it is better to rent.

In terms of which cities were mentioned, Ellis cites Trulia's index as follows:

Where to Buy a Home:
Miami, Detroit, Jacksonville, Arlington, Columbus (OH), and Nashville

Where to Rent a Home:
New York, Seattle, Fort Worth, Omaha, Kansas City, and San Diego.

   How do you think Rent to Own fits into the picture? The funny thing is that it could apply to any of these cities, since it is often situation-specific instead of market-specific. Do you Agree? Disagree? Please let us know.

   Do you have any additional recommendations for any other cities not mentioned here? Let us know, as there might be an buyer, renter, realtor, or investor reading this, and we all like to share and help each other.

Have a Great Day, and Happy Rent-to-Owning !!

Homes For Under $800/Month? Bargains Are Everywhere !

Hi Everyone,
   Hope you had a nice weekend, and if you're a football fan, I hope your team won (as long as it wasn't against my team !).

   I cannot believe that I read this, but I came across a list of some of the top cities in the country, in which you can purchase a median-priced home (assuming a 20% down-payment) for under $800. Once again, I really cannot believe it!

   Luke Mullins of U.S.News, wrote an article titled, "Where to Buy a Home for Less Than $800 a Month", and I read the article on Yahoo Real Estate. The lowest priced city on the list was Atlanta, which assumes a $123,000 median-priced home, with, "a 20 percent down payment--or $24,600--monthly payments for mortgage principal and interest", or $488 per month. Is that amazing? The only issue would be the 20% down-payment for a lot of folks, nowadays. It would be interesting to re-work the numbers with a 10% down payment, but this would probably alter other factors in the calculations and type(s) of applicable mortgages.

   The next cities listed after Atlanta are Pittsburgh, Boise, Columbia (South Carolina), and Phoenix, all of which clock in at under $600/month, using the same calculation methods. Rounding out the Top 10 are Austin, Sarasota, Albuquerque, Minneapolis/St. Paul, and Columbus (Ohio).

   I would be interested in seeing what some of the Eastern Seaboard cities (New York, Boston, Philadelphia, and Washington) would come in with for an average monthly payment. In addition, I would also be curious about the major cities in California. These locations would more than likely be above the others (substantially) due to the higher property prices, but however, it would be interesting to see it and compare it to what the figures were perhaps 2-3 years ago.

   If anyone of our financial/technical readers can re-work these numbers, please feel free to post them as a comment to this post.

Have a Great Week, and Happy Rent-to-Owning !!