When you are making a house payment, you are getting equity in that house. Growing home equity is the easiest way to grow your family’s wealth.
There was an article in the Dallas Morning News January 7th edition about the rise of Dallas-Fort Worth area rents. According to the article, the average rent in DFW is now $1,385! New apartments are going for $2000/month or more! With rents this high, is it time to consider buying your home?
Let’s look at some numbers to decide. Let’s check out a $300,000 house with a 10% down payment, a 3.5% interest rate on a 30-year mortgage. Your payment is principal, interest, taxes and insurance will be about $1,767. That’s $382 more than the average rent but $233 less than renting in a new apartment complex. Depending on how new a place you want, you could save money right off the bat.
Another thing to consider is the amount of space you get. That $300,000 home is a three bedroom, two or more bathroom house. Those apartments for under $2000 a month are almost all two bedroom places. The average two bedroom apartment in DFW is 1000 square feet. The average size of a $300,000 house in Dallas is 1560 square feet. That’s an additional 560 square face – almost 56% more space!
I think the most important reason for buying versus renting is starting to grow your family wealth. In the last year, houses in DFW have appreciated an average of 20%! That rate isn’t likely to continue, but the average increase of about 10% is likely. When you are making a house payment, you are getting equity in that house. Growing home equity is the easiest way to grow your family’s wealth.
Are you worried about getting the money for a down payment and closing costs? There are special first time buyer assistance programs for those. I can suggest lenders that can help you with all of the financial challenges. 2021 should be the year you get your own home and move out of that rental!
McKee Smith, REALTOR®, is an experienced real estate agent that specializes in the Dallas and Fort Worth market. He understands the intricacies of the DFW housing market. Remember – McKee has the keys to selling your home!