"I Know Buying a Home Instead of Renting is Better...Stop it Already!"
Without fail, Realtors speak in unison to the crowds.
"Buying a home instead of renting is better!"
These are the reasons [money - comfort - stability..etc ]
Enough already, we have been incessantly trying to convince the public about home buying when there is really no convincing to do. .they already know
A survey made by Hanley Wood Housing 360 revealed a startling statistics about Owners and Renters
Renters already know that buying is better than renting. .
38% are not homeowners just because they think "They may not qualify for a Mortgage"
55% are not homeowners simply because they "Cannot afford the Downpayment"
Adding them together and the numbers don't lie. .
A Startling 93% of renters already know that buying is better than renting . .
The only thing stopping them is their credit and cash at hand.
If we solve these two problems, we can wipe out the rental market in the USA
To my fellow Realtors, stop pounding a message that they already heard...and start solving your clients two major problems
Credit and Cash for the downpayment
That is the only thing renters want to hear. . .so help them now!
You ask yourself?
Why are they already convinced?
Since 1975 statistics show that home prices [Median Sales Price] have steady went up. .
is almost too predictable. .
Every accumulate year shows a steady increase with exception of the obstacles we encountered in 2005 and 2006.
Happy to see we are getting back into the groove of what we call a normal market once again. ..
If we match this with average income earned during the same years, [Mean Household Income] Salaries are moving up and steadily . .similar to house prices.
But the major point to take from this study is that RENTERS [CPI Rent of Primary Residence] have also have seen rental increases year after year. .
is almost too predictable. .
I could easily predict what renters will be paying in the year 2020, 2025, 2030 and beyond.. .
To further amplify the message. .
Here comes this study:
Owners got it made!
Their equity money keeps growing and growing building their net worth year after year for just being homeowners!
A happy and welcome unintended consequence for the vast majority of them.
Meanwhile, RENTERS. . .
Their [Median Net Worth] is the "unintended" consequence as well. .
No one wants to rent to be worth less!
Going back to my initial argument that RENTERS do not need to be reminded of this anymore. .
Let's look at the problem and come up with solutions. .
Is it affordable?
Yes it is!
If you have the credit and the money for the downpayment. .
There has never been another time in the history of housing. .[at least since 1971] how affordable is to really buy a home right now.
Interest rates are low...and home prices are holding steady
Let's look at the two problems and come up with solutions. .
America is a nation of borrowers and there is no education for young people to start life the right way. Parents are doing a lousy job!
From the very first time they leave college of their parents homes, they are already loaded with college debt and credit card debt.
A bad way to start an unhappy life...loaded with bills and forced to take the first job offered, ending up stuck and pressured to hold and pursue their dreams because they need that weekly paycheck to pay their bills. .
Now, adding insult to injury (a self inflicted obstacle), they start a family with a baby on hand, loaded with debts, unhappy job and now their dreams are further away .. .no wonder anti-depressants are sold in record numbers in our country..and divorced kids in schools seems to be the "norm"
Your credit is your ticket to own a home.
Unfortunately that ticket hard to come by if you are not disciplined and responsible
In 2006 a credit rating below 640 was good enough to own a home. .
Today, the same credit accounts to a very small amount of approved loans.
Good credit is compensated by availability. .
in 2006 very few people needed great credit to buy a home. .
in 2010 those people with 680-850 credit score were the majority of purchasers of real estate.
You get it now?
Good credit is very important and it starts with Discipline.
No, you don't need that expensive car just yet. .
No, you can't put that vacation on a credit card...undeserving in my opinion
A vacation is a reward..not a right
Getting married early?
Having kids? Accidentally or planned. .they are the major force that keeps many young people inside an economic spiral.
If you have them already, it will take time to get out from that economic spiral, but with a little discipline and strategic planning, you can do it!
Being disciplined also means about taking responsibility.
No one should pay for your lack of judgement or poor planning.. except you!
Coming from a third world country and you get perspective of this really fast.
You don't work, you don't eat.
You make a mistake, lose your job, bet all your money at the casino?. .and your local government is there for you. .watching you . .waiting when you have enough money to pay taxes!. .
Otherwise. .you are on your own!
Here in the states, you make a mistake. . .and probably there is a Government assistance program with your name on it.
Discipline and Responsibility is what will drive your credit score up
What about the money for the downpayment?
Discipline and Responsibility is what will also help you on this...
The good news is that there is more help on the downpayment part for you that the credit building score part you must undertake yourself.
There are currently several programs to assist you in getting the money necessary to buy a home.
But, don't expect a "no down payment loan" available for you .. .
Those are gone with the dinosaurs unless you serve in the armed forces and have a certificate of eligibility from the VA
As a Realtor Broker serving people in two languages, I have unique perspective about this subject. I find many people needing more guidance than money...and this is what I want to instill to my fellow Realtors.
We know the problem and I can assure you we are part of the solution
About the Author: Fernando Herboso is Broker/Owner for Maxus Realty Group in Maryland. Fernando can be reached by phone at 301-246-0001 or email Fernando@ReallyNiceHomes.com