Has your landlord announced yet another rent hike? Are you searching for a new rental and finding nothing affordable and acceptable? Have you heard yourself say “I cannot afford to rent in Florida!”?
Throughout my various posts on social media and throughout some of my blogs on www.merriottproperties.com you will find the hashtag #ICannotAffordtoRentinFlorida, but what does it mean?
Throughout Florida and particularly in Pinellas County, Real Estate is now substantially more affordable to buy rather than rent.
How can I say that? Because it is true!
In this post, I will explain why buying makes more sense right now, and show you just how affordable buying your own house can be!
Cost of renting in Pinellas County
Currently, the average monthly rent in Pinellas County sits around $1050-$1150 for a two-bedroom home, and between $1450 and $1650 for three bedrooms!
The amount of cash needed to get into a rental can be really high, as well. Most Pinellas County rentals require you to pay your first and last month’s rent, plus a security deposit (usually equal to one full month’s rent). If you are renting with pets, expect to pay an extra deposit and/or non-refundable pet fee. Some places even charge monthly “pet rent.”
At this rate, it can take thousands of dollars just to get set up in a rental. For that much money, you could realistically be making a down payment on a house of your own!
To get a feel for the difference between a monthly mortgage payment and typical rent for your zip code, you can run the numbers through a rent vs. buy calculator and prepare to be amazed!
Cost of buying a home in Pinellas County
The median home price in Pinellas was $235,000 in April 2017. Decent starter homes (smaller, less expensive homes traditionally purchased by younger people just starting out) can currently be found at the $150,000 - $175,000 price point.
Yes, those numbers may sound daunting to a first-time buyer, but believe it or not, a monthly mortgage payment for a terrific house could be cheaper than rent on a small apartment!
Stability of mortgage payments vs. rent
As you may have noticed recently, rent rates in Florida are consistently on the rise. It’s no fun trying to plan a monthly budget and getting hit with a notice that your rent will increase next month.
A home mortgage offers the benefit of payment stability. With a fixed-rate mortgage, you never have to worry about your monthly payment changing. You can lock in a low rate and keep it for the entire life of the loan!
Once you have built up some equity in your house, refinancing your mortgage is an option that can further lower your payment and interest rate.
This means that no matter what happens in the housing market, your payment will never go up (and could potentially go down!).
Finding an affordable mortgage
Decades ago, it was difficult to qualify for a mortgage without a 20% down payment in hand. Fortunately, getting approved for a mortgage doesn’t have to be so expensive anymore!
It is now possible to get conventional loans for 3%, 5% or 10% down. 1% down is even becoming popular! For more information about these low down payment mortgages, ask me directly or reach out to a mortgage broker (I personally like and recommend Patrick Anderson at CrossCountry Mortgage, Inc.) to discuss your options.
FHA loans are also a popular option. These loans are insured by the Federal Housing Administration. This allows lenders to offer competitive, affordable mortgage rates to people with smaller incomes and savings accounts. FHA loans can be had for as low as 3.5% down.
Down-payment assistance and homebuyer education
In Pinellas County, down-payment assistance is available for buyers who meet certain criteria and attend a first-time home buyer class. The classes are designed to demystify the homebuying process and offer money-saving tips for new homeowners.
The Housing Finance Authority of Pinellas County and the Tampa Bay CDC (Community Development Corporation) both currently offer very attractive down-payment assistance programs! In some cases, you may qualify even if this is not your first time purchasing a home.
I always recommend my first-time buyers utilize these programs if they qualify. If you have any questions about them, ask me!
I believe that homeownership is one of the primary steps to financial freedom and personal wealth-building. Now is a perfect time for you to take that step, too! Stop filling your landlord’s pockets and make an investment in your future!
Let me show you how to get started today! Contact Doug Merriott via call or text anytime at 727-400-0161, or via email at firstname.lastname@example.org