• CMG MORTGAGE, INC. NMLS #1820

Download Case Study: Buying vs. Renting

  • February 16, 2017

“Is it better to rent or buy?” Real estate professionals face this question rather frequently and each side presents its own financial benefits. However, evidence supports that homeownership is more affordable than long-term renting.

Many renters avoid buying because of the daunting down payment. For prospective buyers looking to make at least a five-year investment in the home, homeownership will be the less expensive option. Typically, with a 3% annual appreciation rate and 12% in closing costs (6% to the realtor and 6% to the taxes, title, and additional costs), it would take the buyer four years to break even on their purchase. All throughout that time, if the homeowner is making reasonable effort to pay off the mortgage, they are building equity and credit.

Apartment rents are growing exponentially. CNBC reports that rents are rising faster than most other consumer purchases. In the last four years, it has gotten more difficult for many renters to save for a down payment, “even though homeownership turns out to be a better deal in many markets around the country."

Making the decision to keep renting or to buy a home is a largely financial one, and financially it favors the buyers. With flexible loan financing options, skyrocketing rents, and historically low rates, buying is the better long-term option.

Carlos Aguilar
Loan Officer
NMLS # 791382
Branch NMLS # 1211319

Carlos Aguilar

PHONE: (949) 864-8131
carlosa@cmgfi.com

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© CMG Financial, All Rights Reserved. CMG Financial is a registered trade name of CMG Mortgage, Inc., NMLS ID #1820 in most, but not all states. CMG Mortgage, Inc. is an equal opportunity lender with corporate office located at 3160 Crow Canyon Road, Suite 400, San Ramon, CA 94583 888-264-4663. Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act No. 4150025; AK #AK1820; AZ #0903132; Colorado regulated by the Division of Real Estate; Georgia Residential Mortgage Licensee #15438; Illinois Residential Mortgage Licensee; Kansas Licensed Mortgage Company #MC.0001160; Massachusetts Mortgage Lender License #MC1820 and Mortgage Broker License #MC1820; Mississippi Licensed Mortgage Company Licensed by the Mississippi Department of Banking and Consumer Finance; Licensed by the New Hampshire Banking Department; Licensed by the NJ Department of Banking and Insurance; Licensed Mortgage Banker – NYS Department of Financial Services; Ohio Mortgage Broker Act Mortgage Banker Exemption #MBMB.850204.000; Licensed by the Oregon Division of Financial Regulation #ML-3000; Rhode Island Licensed Lender #20142986LL; and Licensed by the Virginia State Corporation Commission #MC-5521. CMG Mortgage, Inc. is licensed in all 50 states and the District of Columbia. Offer of credit is subject to credit approval. For information about our company, please visit us at www.cmgfi.com. To verify our complete list of state licenses, please visit www.cmgfi.com/corporate/licensing and NMLS Consumer Access (www.nmlsconsumeraccess.org).