Rent or Buy Your Home…Which is Better?

Rent or buy? Gosh, isn’t that the $64 Million Dollar question? And as many things go in real estate, the answer depends on your circumstances.

Keys to Success When Buying a Home

Smart Tips for Buying Your Home

Let’s start with the current state of rentals here in Phoenix.

In the ARMLS rental database the overall average lease rate for active listings is $1,820 per month and the average sq. ft. is 1,932. For apartments, the average rent is $1,568 with an average sq. ft. of 1,102 giving us an average rent of $1.42 per sq. ft. A year ago the rate was $1.22 per sq. ft., so the rise in asking price is 16.6% in just 12 months. The number of active apartment rental listings has declined 10% from 643 to 578 since last year.

In  nutshell, rents are rising and there are fewer homes to rent. And by the way, who wants to live in an apartment? Seriously. So let’s just focus on the houses.

If you are paying $1820 a month to rent a house, you might be thinking that you could be spending that money on a mortgage payment instead. For a low down payment, FHA-type loan, that gets you about $265,000 in house spending dollars. That gets you into a pretty nice house! But is it still better to buy or rent?

Reality time…

Check out this great rent-vs-buy calculator that the NY Times put together. It factors in all the costs of both buying and renting, and analyzes the pay-off for each. Given the scenario above, spending $1800 in rent vs $1800 in mortgage (plus taxes and insurance), if you are staying put for at least 2 years, buying will probably be the better choice, financially speaking. If  you are spending $1500 in rent, but could buy an equivalent house for $225,000, in two years, you will be ahead if you buy instead of renting.

Given the current climate in Phoenix right now, if you stay at least 2-3 years at the same address, you will most often  spend less if you buy a home rather than renting an equivalent home.

Of course, there’s the matter of the down payment…for an FHA loan, you must put down at least 3.5% of the purchase price for your down payment. Add to that closing costs, and you are looking at about $13,500 in cash. Yikes!

But start thinking you will never live long enough to make this dream a reality. It is possible to negotiate with the seller to add the closing costs to the purchase price, effectively financing those closing costs. AND you might be eligible for on of the down payment assistance programs that could cover the down payment. With $1000-2000 in your pocket, you could cover the remaining costs. Now that’s a pretty sweet deal!

Check out homes in the East Valley – Mesa, Tempe, Chandler and Gilbert – that might make great alternatives to renting…

Displaying 51 - 77 of 77 results.
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5135 E Evergreen Street 1199 Mesa 85205, Northpointe 1 Lot 1153-1268 1269-1272

$224,900
Bedrooms: 3
Baths: 2
Sqft: 1,116
MLS: #6033856
Broker: Realty ONE Group
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1126 N Steele -- Mesa 85207, Marble Creek

$230,000
Bedrooms: 2
Baths: 2
Sqft: 1,153
MLS: #6033315
Broker: HomeSmart
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6335 E Brown Road 1138 Mesa 85205, Brookfield West 1 Unit 2 Amd

$249,900
Bedrooms: 3
Baths: 2
Sqft: 1,325
MLS: #6034856
Broker: HomeSmart
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608 E Franklin Avenue Mesa 85204, North Sunland Gardens

$250,000
Bedrooms: 4
Baths: 2.75
Sqft: 2,129
MLS: #6019587
Broker: Keller Williams Integrity First
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6060 E Billings Street Mesa 85205, Dreamland Villa 14

$229,950
Bedrooms: 2
Baths: 2
Sqft: 1,051
MLS: #6018129
Broker: HomeSmart
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146 S 83rd Place Mesa 85208, Palo Verde Vista Lots 16-47

$229,900
Bedrooms: 4
Baths: 1.75
Sqft: 1,602
MLS: #5979611
Broker: Lanier Real Estate, LLC
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321 E Garnet Avenue Mesa 85210, Melody Mesa

$230,000
Bedrooms: 3
Baths: 2
Sqft: 1,228
MLS: #6032448
Broker: RE/MAX Fine Properties
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2357 E Covina Street Mesa 85213, Mcafee Heights

$205,000
Bedrooms: 2
Baths: 1
Sqft: 918
MLS: #6033873
Broker: eXp Realty
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1609 W Pueblo Avenue Mesa 85202, Alma Ests 6

$249,900
Bedrooms: 3
Baths: 2
Sqft: 1,248
MLS: #6010747
Broker: Cactus Realty Consultants
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761 Leisure World -- Mesa 85206, Leisure World Golden Hills Plat 9 Amd

$184,900
Bedrooms: 2
Baths: 1
Sqft: 952
MLS: #5999901
Broker: RE/MAX Classic
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5720 E Covina Road Mesa 85205, Velda Rose Estates 2

$210,000
Bedrooms: 2
Baths: 2
Sqft: 1,400
MLS: #6007753
Broker: Big Door Realty, LLC
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1714 E Jarvis Avenue Mesa 85204, Mesa Linda 2 Lots 95-110, 115-144

$239,000
Bedrooms: 3
Baths: 2
Sqft: 1,632
MLS: #6026473
Broker: Equity Solutions Realty
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6449 E Dallas Street Mesa 85205, Dreamland Villa 16

$245,000
Bedrooms: 3
Baths: 2
Sqft: 1,366
MLS: #6026142
Broker: Apache Wells Realty
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1060 Leisure World -- Mesa 85206, Leisure World Plat 11 Lot 888-1097 & TR A-H

$189,900
Bedrooms: 2
Baths: 1.5
Sqft: 986
MLS: #6015118
Broker: RE/MAX Classic
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10946 E Wier Avenue Mesa 85208, Signal Butte Manor

$230,000
Bedrooms: 3
Baths: 2
Sqft: 1,302
MLS: #6029634
Broker: Keller Williams Realty Phoenix
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8307 E Pueblo Avenue Mesa 85208, Fountain OF The Sun Parcel NO 2

$220,000
Bedrooms: 2
Baths: 2
Sqft: 1,617
MLS: #6027090
Broker: eXp Realty
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2156 N Stockton Place Mesa 85215, Apache Wells Mobile Park 4B

$220,000
Bedrooms: 2
Baths: 2
Sqft: 1,564
MLS: #5781057
Broker: Farnsworth-Ricks Management & Realty, Inc.
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341 Leisure World -- Mesa 85206, Rossmoor Leisure World Golden Hills Plat 3 Cond PL

$232,500
Bedrooms: 2
Baths: 2
Sqft: 1,584
MLS: #6005741
Broker: Networth Realty of Phoenix
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4906 E Brown Road 37 Mesa 85205, Terra Mesa Lot 1-40 TR A-D

$249,800
Bedrooms: 3
Baths: 2
Sqft: 1,388
MLS: #6026507
Broker: R.L. Wood & Company, L.L.C
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1886 E Lindrick Drive Chandler 85249, Sunbird Unit Twelve

$238,000
Bedrooms: 1
Baths: 1.75
Sqft: 932
MLS: #6021964
Broker: Cactus Mountain Properties, LLC
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816 S Nevada Way Mesa 85204, Park Village Estates

$244,995
Bedrooms: 4
Baths: 2
Sqft: 1,400
MLS: #6017413
Broker: The John Samuels Agency
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9844 E Farmdale Avenue Mesa 85208, Crismon Manor

$240,400
Bedrooms: 3
Baths: 2
Sqft: 1,203
MLS: #6025978
Broker: My Home Group Real Estate
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2115 E Farmdale Avenue Mesa 85204, Summer place

$244,000
Bedrooms: 2
Baths: 2
Sqft: 1,043
MLS: #6026523
Broker: Ashby Realty Group, LLC
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823 S 79th Way Mesa 85208, Fountain OF The Sun-Parcel 13 Amd

$225,000
Bedrooms: 2
Baths: 2
Sqft: 1,395
MLS: #6024882
Broker: Keller Williams Realty East Valley
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4514 E Catalina Avenue Mesa 85206, Sunland Village

$249,900
Bedrooms: 2
Baths: 2
Sqft: 1,748
MLS: #6008220
Broker: Visionary Properties
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7117 E Aspen Avenue Mesa 85208, 084

$200,000
Bedrooms: 3
Baths: 1
Sqft: 1,014
MLS: #5981281
Broker: Keller Williams Integrity First
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6706 E Adobe Street Mesa 85205, Dreamland Villa 16

$180,000
Bedrooms: 2
Baths: 2
Sqft: 1,378
MLS: #5711844
Broker: Hunt Real Estate ERA
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ARMLS Listing Data last updated 2/27/2020 5:00 AM MST.

Kristin LaVanway
480-282-7464
kristin@hereinphoenix.com