Do you remember the New Albany Condo I advertised in last week’s email?
I had 20 buyers visit my open house, we received 3 offers above list price, and 2 agents called me with eager buyers after a contract was signed.
There’s a lot of demand for affordable homes and condos for first time buyers.
There’s a good reason why: owning is less expensive than renting and it builds wealth.
You Could Save $450 Per Month
If you would purchase a townhouse like the one above for $175,000 (that was the list price) with 10% down, you monthly payment including principal, interest, property taxes and insurance would be $1,138 per month (interest rate of 4.62%).
The estimated monthly rent is $1,599 – which is substantially higher.
Monthly rents have increased much faster than mortgage interest. Here’s a chart from the Census Bureau that shows how the average rent has changed over the years.
Why Homeowners Are Richer Than Renters
According to a study by Harvard University the net worth of homeowners is almost 48 times higher at age 65 than for renters (see below).
You can see that the average net worth of home owners is $319,200, while the net worth of renters is a mere $6,710.
Owning a home is a very good investment. There are 2 ways how home owners increase the equity in their homes:
- They pay off principal on their mortgage. It’s very little at the beginning, but it adds up over time. If you get a 15-year mortgage and you live in your house for 9 years (that’s the average time Americans stay in a home) you build a lot of equity (= net worth).
- Home values will likely increase. Since 2012 Columbus home values were up by 36.4%. That results in a substantial gain in net worth.
If you keep renting you will pay your landlord’s mortgage! Isn’t it time to increase your OWN net worth? Call or text me at (614) 975-9650!
Susanne Novak has been a Realtor since 2007. She is the broker and owner of RE/MAX 24/7 in the Dublin Historic District. Susanne typically helps 50-60 families each year with their real estate needs. She's your trusted advisor when you search for your dream home, and a skilled negotiator when she lists your property to get top dollar when you sell.