For the last few years, the latest fad was to rent, not buy. After the panic that was the 2007 housing crisis, many people thought that it would be better to rent than to buy. Moreover, the number of renters is now at an all-time high, with many people over 40 currently renting. With a high demand for rentals and lower vacancy, now, more than ever, is the time to buy.
By mid 2015, there was over 43 million families in the U.S. renting, compared to 32 million families renting in 2005. This has been an astronomical increase in the number of renters in recent years, and it is still growing. In the past few years, incomes have been stagnant, and the high demand and low supply for rentals have increased the living cost of renters. Not to mention, New Jersey is one of the most expensive states to rent in, with a total cost-burdened of 51.5%. Renters are cost-burdened when they spend over 30% of their income on their rent. This year, rents on average are expected to rise by 4%. That, in combination with stagnating incomes, you can expect the number of New Jerseyans who are cost-burdened to increase.
In this coming year, housing prices will finally stabilize, and the implementation of TRID will give a security blanket to those still in shock from the housing bubble bursting a few years back. Not to mention, the increasing demand for rental properties will lower the demand in the housing market, making it cheaper to own a home. Soon, the pendulum will sway back towards home ownership, and 2016 could be that year.
However, if you are in a situation where you cannot finance a home, renting is not a complete loss, especially in South Jersey. A good majority of those who are cost-burdened by rentals reside in the central and northern parts of the state, so South Jersey is still looking good. That may change in the near future, but for now, you’re in the clear. Our advice is to start seeing if a mortgage is something that you can afford.
Remember, whether buying, selling, or renting, we have you covered. Just give us a call or stop on in, and we can get you started.