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Housing Costs Keep Rising
Buying vs. renting during economic uncertainty
A friend of mine lost his job 4 years ago and it took him 3 years to find another permanent job. During that time, he sold his house, right in the middle of a huge rise in housing prices in my area. He lost out on a lot of profits as well as losing a house he loved.
He got into an apartment instead that cost a lot less per month. Well, it was a one bedroom apartment instead of a four bedroom house with half an acre. It’s a cozy, modern space but he misses his house.
At first it seemed to make financial sense. But now rents are rising. Inflation means even good tenants are going to face a squeeze.
This is the problem with renting vs. owning.
If you own your home, you may have to pay more in property taxes, but at least your mortgage is usually fixed…. though some people get balloon mortgages and such.
If you are renting, theoretically you are a lot more mobile and have more freedom. However, inflation can really screw up how much you pay for housing.
When the economy is in a good place, with low inflation and booming markets, it may make sense not to buy a house. Take the money and stick it in the stock market instead, say, and watch your nest egg expand.
