Starter Homes vs. Renting: Where Homeowners Can Save

first_img  Print This Post Data Provider Black Knight to Acquire Top of Mind 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago in Daily Dose, Featured, Journal In a report released Wednesday by Trulia, a handful of cities contain starter homes that cost less than living in a rental in the long-term. While moving in with a roommate vs. living alone is guaranteed to cut your payments in half, starter homes can be a wiser long-term investment. If getting a roommate is necessary, it will be easier to do so in the larger space a starter home provides compared to a rental unit. In the report, Trulia assumes buyers are making the choice to take on a 30-year fixed rate loan and paying 20 percent upfront if they buy, but based on the data, “buying a home is 37.4 percent cheaper for households who move every seven years” than renting. When Trulia accounted for the total monthly costs of buying a starter home, including mortgage payments, maintenance, insurance, and taxes, Michigan, Florida, Alabama, Pennsylvania, and Tennessee all contained cities showing starter homes to be 50 percent cheaper to buy than renting a housing unit with someone else over seven years. The cities include Detroit, West Palm Beach, Birmingham, Philadelphia, Memphis, and Knoxville respectively.In Detroit, a starter home can be purchased for as low as $16,463, whereas a home in West Palm Beach can be purchased for $107,083. Homes in Birmingham, Philadelphia, Memphis and Knoxville can all be purchased for less than $60,000 based on Trulia’s data. Still, it’s important to act on these starter homes quickly, as Trulia’s recent Price and Inventory Watch found a 20.4 percent drop in starter home inventory year-over-year nationwide.To calculate the cost of buying and renting, Trulia used their quality-adjusted measure of home prices and rentals, calculated initial and future monthly costs, and took into account expected price and rent appreciation as well as projected inflation. They also factored in one-time costs and proceeds, including closing costs, down payments, sale proceeds, and security deposits.To see the full methodology and data sets, click here. Sign up for DS News Daily Home / Daily Dose / Starter Homes vs. Renting: Where Homeowners Can Save Buyers buying Detroit Homeowners Memphis Philadelphia Rentals Renting Starter Homes Trulia West Palm Beach 2017-10-12 Dean Terrell Related Articles Demand Propels Home Prices Upward 2 days ago October 12, 2017 1,417 Views Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago The Best Markets For Residential Property Investors 2 days ago Previous: JPMorgan Chase Beats Wall Street Revenue Estimates Next: Freddie Mac Announces Small-Pool Pilot With EarnUp Starter Homes vs. Renting: Where Homeowners Can Save The Week Ahead: Nearing the Forbearance Exit 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Share Save The Best Markets For Residential Property Investors 2 days ago About Author: Dean Terrell Demand Propels Home Prices Upward 2 days ago Tagged with: Buyers buying Detroit Homeowners Memphis Philadelphia Rentals Renting Starter Homes Trulia West Palm Beach Subscribelast_img

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