So, you’re looking at moving and you’re not sure if renting or owning a local Chicago IL home is right for you?
You’re not sure if one is a better financial decision than the other?
You’re not sure if you’ll be able to find the type of house or apartment you’d like to live in?
You’re not sure what you can handle financially?
Well this article will dive into ways you can learn how to know if renting or owning a home is right for you in the Chicago area.
How To Know If Renting Or Owning A Home Is Right for You in Chicago
Throughout the 1950’s-1990’s, home ownership was a major goal of most families across America. Owning a home was the “American Dream” and if you didn’t own your house there was almost this stigma that went with that.
But, that rule has changed in recent years. The economic downturn paired with the bursting of the housing bubble makes renting an attractive option for many Americans… maybe even you.
In the past, the choice to rent or own here in Chicago was about whether you’d prefer to live in a house or an apartment. Now, there are opportunities to purchase apartments / condos and rent homes, so there are options for renters or perspective owners to live in whatever type of property that they’d prefer.
Renting is great for people who want flexibility. Perhaps you’re just starting your career, and you’d like to be able to relocate quickly. Renting is a wonderful option for people who like to “try out” various neighborhoods in their city before finding a place to settle down.
Owning a home ties you to one location for a good period of time. It would destroy your credit to step away from your mortgage, and selling your home is a long, arduous process that could end in you losing some of your initial investment.
In many cases, contrary to popular opinion, it can be more cost-effective to rent than own, especially in situations where the local housing market isn’t going up in value very much each year. While renters pay a fixed amount each month, homeowners are required to pay additional fees, such as homeowners insurance, maintenance, repairs, HOA (local community association fees), amongst others.
It’s not always best to rent, however. Owning a home is still the American dream. You have the right to paint, decorate, and reconfigure your house however you’d like, without the worry of risking your security deposit or upsetting your landlord. It’s the ultimate in freedom when it comes to your house.
Homeownership as an investment. While the housing market has rebounded here locally in Chicago IL… the home values aren’t increasing like they were during the build up of the housing bubble (which is a great thing actually)… but another benefit of home ownership is homeowners typically enjoy the potential appreciation of the value of their home.
From 1968-2004, home values grew by approximately 6.4% annually, outpacing inflation (as well as many stocks & other financial instruments).
As a homeowner with a fixed rate mortgage, you enjoy the benefit of inflation protection. For example, if your mortgage payment is $500 each month, you’ll pay that for the duration of your loan. However, the purchasing power of $500 can change significantly over the course of 15, 20, or 30 years. As most people’s income grows over time, a fixed- rate mortgage can eat less and less of your take-home pay each month.
There are many factors to consider when deciding whether to purchase or rent your next home. The key is doing exactly what you’re doing now… learning how to know if renting or owning a home is right for you.
The most important thing is to not take on any payments that you cannot reasonably expect to pay for the entire term of the agreement, whether it be a $600 monthly rent twelve months, or a $550 monthly mortgage for the next 15 years.
Have You Considered Renting To Own A Chicago Home?
There is another “hybrid” option to just renting or buying a house.
If you would love to own your own house in our area… and…
- Just want to try a house out before you buy it
- You’re not able to get a home loan to purchase a house right now for various financial reasons
- You have some cash to put down on a home and can pay the rent and would rather work toward owning that house
… renting to own a local house may be right for you!
Check out the rent to own process here on this website and if you want to get on our list to see Local Chicago IL Rent To Own Homes… head over here to see available rent to own homes here in Chicago.
See our latest rent-to-own homes by going through the link below!