With Rents on the Rise – Is Now the Time To Buy?

<article class="post-2291 post type-post status-publish format-standard has-post-thumbnail hentry" id="post-2291"><span class="entry-date">August 3, 2021</span><div class="entry-header center-block text-center"><h1 class="entry-title">With Rents on the Rise – Is Now the Time To Buy?</h1><div class="shareBlock"><div class="shareTitle">Share</div><div class="shareIcons"><a aria-label="Twitter Share Link" class="twitter solid display-inline-block" data-tracking="Post,Social Post Link Clicked,Twitter" href="http://twitter.com/share?text=With+Rents+on+the+Rise+%E2%80%93+Is+Now+the+Time+To+Buy%3F&amp;url=https%3A%2F%2Fgilliggroup.com%2Fblog%2Fwith-rents-on-the-rise-is-now-the-time-to-buy%2F" target="_blank"><span class="force-hidden">Twitter</span></a>
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<p><img alt="With Rents on the Rise – Is Now the Time To Buy? | Simplifying The Market" class="webfeedsFeaturedVisual wp-post-image" decoding="async" link_thumbnail="" loading="lazy" sizes="auto, (max-width: 549px) 100vw, 549px" src="https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144312/20210803-KCM-Share-549×300.jpg" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144312/20210803-KCM-Share-549×300.jpg 549w, https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144312/20210803-KCM-Share.jpg 750w" style="display: block; margin-bottom: 5px; clear:both;max-width: 100%;" width="358"/></p>
<p>According to recent data from <em>realtor.com</em>, median <strong>rental prices have reached their highest point ever recorded</strong> in many areas across the country. The <a href="https://www.realtor.com/research/june-2021-rent/">report</a> found rents rose by <strong>8.1%</strong> from the same time last year. As it notes:<span id="more-44860"></span></p>
<blockquote>
<p><em>“<strong>Beyond simply recovering to pre-pandemic levels, rents across the country are surging.</strong> Typically, rents fluctuate less than 1% from month to month. In May and June, rents increased by 3.0% and 3.2% from each month to the next.”</em></p>
</blockquote>
<p>If you’re a renter concerned about rising prices, <strong>now may be the time to consider purchasing a home</strong>.</p>
<h4><strong>Monthly Rents Are Higher Than Monthly Mortgage Payments</strong></h4>
<p>When you weigh your options of whether to buy a home or continue renting, how much you’ll pay each month is likely top of mind. According to the <em>National Association of Realtors </em>(NAR)<em>,</em> monthly <a href="https://www.nar.realtor/blogs/economists-outlook/housing-affordability-falls-in-may-as-home-prices-rise-faster-than-income">mortgage payments</a> are rising,<strong> but they’re still significantly lower than the typical rental payment. </strong>NAR indicates the latest data on homes closed shows the median monthly mortgage payment is $1,204.</p>
<p>By contrast, the median national rent is $1,575 according to the most current data provided by <a href="https://www.realtor.com/research/june-2021-rent/"><em>realtor.com</em></a>. <strong>In other words, buyers who recently purchased a home locked in a monthly payment that is, on average, $371 lower than what renters pay today</strong> <em>(see graph below)</em>:<a href="https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144310/20210803-MEM-Eng-1.png"><img alt="With Rents on the Rise – Is Now the Time To Buy? | Simplifying The Market" class="aligncenter wp-image-44862" decoding="async" height="488" loading="lazy" sizes="auto, (max-width: 650px) 100vw, 650px" src="https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144310/20210803-MEM-Eng-1.png" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144310/20210803-MEM-Eng-1.png 1000w, https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144310/20210803-MEM-Eng-1-400×300.png 400w" width="650"/></a></p>
<h4><strong>Rents Are Rising Sharply, and They Continue To Increase</strong></h4>
<p>The difference in monthly housing costs when comparing renting and homebuying today is significant, but many would-be homebuyers wonder about the future of rental prices. If we look to historical <a href="http://www.census.gov/housing/hvs/files/currenthvspress.pdf">Census</a> data as a reference, <strong>the median asking rent has risen consistently since 1988 </strong>(<em>see graph below</em>):<a href="https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144308/20210803-MEM-Eng-2.png"><img alt="With Rents on the Rise – Is Now the Time To Buy? | Simplifying The Market" class="aligncenter wp-image-44861" decoding="async" height="488" loading="lazy" sizes="auto, (max-width: 650px) 100vw, 650px" src="https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144308/20210803-MEM-Eng-2.png" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144308/20210803-MEM-Eng-2.png 1000w, https://files.simplifyingthemarket.com/wp-content/uploads/2021/07/30144308/20210803-MEM-Eng-2-400×300.png 400w" width="650"/></a>The rise in rent over time clearly shows one of the major advantages homeownership has over renting: <a href="https://www.simplifyingthemarket.com/2021/05/27/how-misunderstandings-about-affordability-could-cost-you/?a=712984-fa409495d5d70154d03a25e81e9540e2">stable housing costs</a>. Renters face increasing costs every year. When you purchase your home, your mortgage rate is locked in for 30 years, meaning your monthly payment stays the same over time. That gives you welcome peace of mind and predictability for many years ahead.</p>
<h3><strong>Bottom Line</strong></h3>
<p>With rents continuing to rise across the country, renters should consider if now is the right time to buy. There are multiple benefits to buying sooner rather than later. Let’s discuss your options so you can make your most powerful decision.</p>
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