| Historically speaking, the answer to the rent or buy | | | | median price since February 2004. Which could mean |
| question is that usually it's smarter to buy a house. | | | | it's a great time to buy, or it could mean home values |
| These are not usual times. The true answer to that | | | | will continue to fall. |
| question, of course, depends on the individual | | | | Home ownership is more than about just a place to |
| situation. There are some factors to consider when | | | | live, it is an investment. The portion of your monthly |
| making this important decision. | | | | payment that goes toward principle ideally raises the |
| Some of the normal reasons to choose renting over | | | | equity in your home each month. These days the |
| buying a home include plans to relocate in the next | | | | return on the investment all has to do with long-term |
| couple of years or a low rent payment. But in the | | | | plans and the economic outlook. But look at it this |
| current economy, renting could make sense for a | | | | way, the rent money goes totally into someone |
| number of reasons. Renting gives financial flexibility, | | | | else's pocket each month. There is a strong possibility |
| allowing people to save or invest. Other than deposits | | | | that your home value will increase with time, |
| and the monthly rental payments, there is no large | | | | especially if you plan to stay put for a number of |
| initial outlay of money. There are no maintenance | | | | years. |
| costs and time does not need to be set aside for | | | | There are other benefits to buying a home, such as |
| upkeep. | | | | knowing your exact payment for the next 15 to 30 |
| It is important to consider the costs inherent to | | | | years, which can help with planning and budgets. Rent |
| buying a home, such as down payments, closing | | | | payments are likely to increase on an annual basis. |
| costs, interest, insurance, and upkeep. Suze Orman, a | | | | There is also the potential to pay off the loan and |
| financial analyst for CNBC, points out that the | | | | have no monthly mortgage payment. There are the |
| American dream of home ownership can turn into a | | | | intangible benefits to consider as well, like pride in |
| nightmare for those buyers that get in over their | | | | ownership and belonging to a community through |
| heads. The wave of foreclosures across the nation | | | | being part of a neighborhood. |
| can attest to that reality. | | | | There is certainly no reason to rush into buying a |
| The pitfalls of home ownership now include buying a | | | | home. In these uncertain economic times there may |
| home that may lose value, as well as the difficulty of | | | | be good reason to be cautious. But there are also |
| getting a loan in the first place. According to the | | | | good reasons to be a buyer, such as historically low |
| National Association of Realtors, existing home sales | | | | interest rates and lower home prices. has a good |
| fell 8.6 percent in November. The median sales price | | | | calculator that can help crunch the numbers. If renting |
| fell 13.2 percent in November to $181,300, from | | | | is what ends up being the best option, be sure to |
| $208,000 a year ago. That was the lowest national | | | | invest and save each month as well. |