In today’s market it is better for people financially to purchase a home rather than rent. Since mortgage rates are lower than they’ve been in years, this makes it more plausible for people to look into purchasing a home and save money rather than renting out a place and paying more money.
Now before you can really decide if you can purchase a place and not rent, there are some financial factors and questions that you really want to ask yourself.
—Can you qualify for the lowest mortgage rate that is out there right now?
—What tax bracket are you currently in and do you itemize your deductions on your taxes?
— How long do you plan to stay in your home if you do decide to purchase it?
If you do qualify for the lowest rate possible, in the 25% tax bracket and are going to stay in the home for a minimum of 7 years, then you might want to seriously consider purchasing a place and not renting. Putting 20% down with a 30 year fixed mortgage at 3.5% is completely ideal.
Current cities can be broke down like this:
San Francisco: The cost of a mortgage is $2,327, rent is $3,226 with a savings of $899 a month.
Los Angeles: The cost of a mortgage is $1,379, rent is $2,020 with a savings of $641 a month.
San Diego: The cost of a mortgage is $1,314, rent is $1,981 with a savings of $667 a month.
Orange County: The cost of a mortgage is $1,610, rent is $2,423 with a savings of $813 a month.
San Jose: The cost of a mortgage is $1,819, rent is $2,646 with a savings of $872 a month.
Ventura County: The cost of a mortgage is $1,516, rent is $2,274 with a savings of $759 a month.