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Renters Paying Substantially More While Owning Costs Less
In a recent Blog, CoreLogic reported that rent prices have skyrocketed in recent years. Meanwhile, the typical mortgage payment has actually decreased.
ERA Justin Realty’s Grace Tirrito a strong Realtor agent known for her many years of Rutherford and Lyndhurst sales, rentals and listings said, “CoreLogic’s national rent index was up 36% in December 2018 compared with December 2005, while the typical mortgage payment was down 4% over that period.”Why the difference between the costs of renting versus owning? It makes sense that rents have risen. However, how did mortgage payments decrease? CoreLogic explained: “It’s mainly because mortgage rates back in December 2005 were significantly higher, averaging 6.3% for a fixed-rate 30-year loan, compared with 4.6% in December 2018.
The national median sale price in December 2005 – $190,000 – was lower than the $220,305 median in December 2018, but because of higher mortgage rates in 2005 the typical monthly mortgage payment was slightly higher back then – $941 – compared with $904 in December 2018.”
Additionally, a recent report by the National Association of Realtors (NAR) showed that purchasing a home requires less of your monthly paycheck. According to the Economists’ Outlook Blog, NAR’s February 2019 Housing Affordability Index showed that the “percentage of income needed” to pay the typical mortgage has decreased the last three months.
· December – 16.9%
· January – 16.2%
· February – 15.9%
What does this all mean to the current housing market? Grace concluded, “First American said it best in their recent post: The mortgage rate-driven affordability surge has arrived just in time… Rising affordability has already benefited home buyers and, if the lower rate environment persists, we’re in for a continuing strong home-buying season.”
ERA Justin Realty has continuously received the prestigious ERA world-wide ‘Commitment to Excellence Award’. All across the nation, the most sought award that can be achieved in business is the ‘J.D. Power & Associates’ award. Only outstanding business entities are honored and receive it. ERA Real Estate was the recipient of ‘Highest Satisfaction for First and Second Time Home Buyers Among Full-Service Real Estate Firms’ Award. For these reasons, ERA Justin Realty should be your buying and selling Realtor of choice.
For more information on CMAs, consumers can reach the ERA Justin Realty sales team at either of their two Rutherford offices at 118 Jackson Avenue or 57 Park Avenue. By phone at (201) 939-7500, (201) 438-0588 or (201) 438-SOLD. Additional real estate information is also available at the firms 1000s of homes website at www.ERAJustin.com and www.ERAJustinRealty.com
