BUYING VS RENTING
It’s the big question all over our region – Is right now the time to buy? And, once you ask that question, you can’t help but ask more questions, like, “Is buying too complicated for me?” “Are interest rates good?” “Why can’t I just as easily rent a place?” “When I look at my net worth, will buying help me or hurt me in the long run?”
Ed Parcaut invited property manager and realtor, Alison Daniel, from up in Twain Harte, California to answer those questions and more. Now, more than ever, it’s important to understand why the factors in Tuolumne County mean that now is the right time to look seriously at home ownership.
Alison is a long-time property manager professional. Since 2004 she’s been helping people find great rentals and she is also an agent for buyers.
The first thing you need to know is that it’s currently almost as simple to buy as it is to rent, all over the state of California. The new regulations around renting and the exceptions that were put in place for the pandemic means that property owners, “landlords,” are being more careful and more strict about qualifying conditions than ever before. Frankly, it’s tougher than ever for renters to qualify with property owners and managers.
“And, the requirements that we have, and most property managers have, and a lot of landlords have picked up on this as well, is [renter qualifications are] so high that you could buy a house,” said Alison.
These regulations are now reality in California. The message you need to hear is that if you’re thinking about renting in and around Modesto, and you know you can qualify for renting, it’s most likely that you can qualify for home ownership.
It’s not all scary. There are options and opportunities. Purchasing a home can be much easier if you qualify and take part in one of the government assistance programs.
As Ed knows and shares with people all the time: “A lot of people don’t know also that there’s a lot of down payment assistance. So if you do not have those funds for down payment, you can sometimes buy a house for the same amount that you can rent a house.”
This is an enormous piece of information for you to consider if you’ve thought that home ownership is out of reach. It’s not a secret, but the right step to take is to contact a good lender who will help you navigate the options and programs.
Next, talk to your agent. As Alison pointed out, your agent can do a better job of finding you the right property if you tell them which program you qualify for. Depending on your loan, the terms may require certain inspections and condition of repair of the home you wish to purchase.
One of the best things you can do is connect your real estate agent with your lender and create a team of professionals to guide you through the process of owning your home. This is their job and a talented team wants to make your home buying experience better.
A good team will help you navigate all the unknowns. A real estate agent like Alison can help you make a confident, “clean” offer that gets accepted, negotiate closing costs and associated fees. Your lender/broker can help you find specialized local programs like the Tuolumne County grant program.
Once you’ve chosen your lender, they’ve helped you find the right loan product and you’re visiting homes to purchase with your realtor, you can be confident in the interest rates which will affect your payments. Interest rates are still hovering at historic lows.
These low rates compared to less than 10 years ago are your opportunity to build generational wealth. You could be a first-time homebuyer or moving into your second or third home. What matters is that once you are in your home and paying your mortgage (which is often that same amount as your rent payment), you’re building a nest egg for your future and for the next generation.
If you are looking to buy a home for the first time, read The Confident Plan for First Time Homebuyers
Listen to the full interview on Apple Podcasts