A few days ago I was sitting with a client writing an offer for a home in Lakewood. It was a three bedroom one bath on a nice cul-de-sac. The home was priced at $350,000. In the current rental market the home would rent for $2100. His payment with 10% down is $1950, that includes property taxes and insurance.
I loved the market ten years ago because I was working with these kind of numbers. The clients would sit down and discuss payment options with me and we would all wonder why more people were not buying homes. Why would you rent when you can buy for the same price? Maybe they didn't know?
This equation does not even include the fact that as a homeowner you get a tax deduction. Homeowners get to deduct the mortgage interest and property taxes on the home. Call your tax accountant for all the information. That could make the above payment effectively around $1500.
I also just sold a one bedroom condo in downtown Long Beach for $97,000 and the seller paid $3000 of the buyers costs. That makes a payment of $950 with taxes and association dues. Find a one bedroom condo with parking three blocks from the beach with that kind of rent!
Benefits of buying right now...low interest rate, payment that is very close to rent, tax deduction, and you are setting up a forced savings account for yourself. You are building equity in your own home as you pay down your loan.
Some people worry about job stability and being able to afford a house payment. You have to live somewhere, either pay rent or pay your own loan. If you did lose your job you can move in with friends and rent your home....its a great market when most of the homes that are available, will rent for the payment on them!
I have been in business for 23 years. I have seen the highs and the lows. I believe that the next few years will be great opportunities for home ownership.
If you are shopping for real estate in the Lakewood and Long Beach areas … visit http://www.greatlakewoodhomes.com/ to start your search. Make sure and check out the Market Insider section.
If you want immediate advice ... visit http://www.superbroker.com/ or call me directly at 562-882-1581
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