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Should You Buy or Rent a Home?

Should You Buy or Rent a Home?

Here is one simple chart that explains why we think buying a home makes more sense than renting one.

2.24 Blog Visual

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8 replies
  1. Mr. Krispy
    Mr. Krispy says:

    In order to give this graph meaning you need to also chart inflation during the same time. If the rate of inflation is more than the increase in rent then price, as the only consideration is negated. If the rate of inflation is less than the rate of rent then it becomes more important to consider buying when price is the only consideration. Obviously there are many other considerations when deciding whether to rent or carry a mortgage, and those considerations will change during the life time of the individual. A simple graph like this does very little to help a person make a good decision, but this graph, used inappropriately by a real estate agent can help persuade a person to make a buying decision when they may have actually been better off renting at that particular point in their life. Context is everything.

    Reply
    • jhadi@kw.com
      jhadi@kw.com says:

      Mr. Krispy, I understand what you are saying but do you think that based on this slide, a person would impulsively buy a property? I hope not…but I also hope it will open their minds to a potential and then go out and get a financial snapshot picture and then weigh their options… This is the power of the KCM messages. Please don’t beat them up.. :)

      Reply
      • Mr. Krispy
        Mr. Krispy says:

        You might be a bit sensitive if you perceive this as a beat down. It’s not. Your opening statement is that this chart explains WHY you think buying a home makes more sense than renting one. Really? So you just made your decision based upon this one item. Ironically, you responded to me that it would be impulsive for a person to make a decision to buy based upon this chart!…but you did. You put the graph out there as if it’s a meaningful tool to help a person make a decision. I’m saying that it is NOT meaningful unless you put it into context and show it’s relationship to inflation. As a Designated Broker, I can tell you that a high percentage of real estate agents wouldn’t be able to put your graph into context for the buyer because they don’t have inflation history at their finger tips. Therefore this graph could lead a buyer in the wrong direction. KCM has many excellent visual aids available for real estate agents and buyers alike, but this isn’t one of them. Sorry.

        Reply
    • jreyenga@keeferealestate.com
      jreyenga@keeferealestate.com says:

      Its never better to rent. Rent is throwing money down the rabbit hole. Inflation never will be a factor. Tell me when ever in history renting has been an advantage to owning. Always own.

      Reply
  2. Amanda
    Amanda says:

    I think a powerful message to go along with this graphic is to think about two people – one who rented over this 25 year period, and one who paid a fixed rate mortgage payment on a home. Discuss how buying a home can be a great way to hedge against inflation…

    Reply

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