Homeownership Provides an Alternative to Rising Rents

​The 2023 Housing Forecast from realtor.com expects rents will keep climbing.
 (see graph below):

That forecast projects rents will increase by 6.3% in the year ahead (shown in green above). When compared to the blue bars in the graph, it is clear that the 2023 projection does not call for an increase as drastic as the ones renters have seen over the past two years, but it is still above the historical average for rent hikes between 2013 and 2019.

That means, if you are planning to rent again this year and you have not yet renewed your lease, you may pay more when you do.
These rising costs may make you reconsider what other alternatives you have. If you are looking for more stability, it could be time to prioritize homeownership. One of the many benefits of owning your own home is it provides a stable monthly cost that you can lock in for the duration of your loan. As Freddie Mac says:

“Monthly rent payments may increase over time, but a fixed-rate mortgage will ensure that you’re paying the same amount each month. With a fixed-rate mortgage, your interest rate is locked in for the life of loan. Steady payments allow you to budget wisely and make plans for the future.”

If you are planning to make a move this year, locking in your monthly housing costs for the duration of your loan can be a major benefit. You will avoid wondering if you will need to adjust your budget to account for annual increases like those that you would if you left your housing payment up to your landlord and their renewal cycle.

Homeowners also enjoy the added benefit of home equity, which has grown substantially. In fact, the latest Homeowner Equity Insight report from CoreLogic shows the average homeowner gained $34,300 in equity over the last 12 months. As a renter, your rent payment only covers the cost of your dwelling. When you pay your mortgage on a house, you grow your wealth through the forced savings that is your home equity.
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If you’re thinking of renting this year, it’s important to keep in mind the true costs you’ll face.
Let’s chat to see how you can begin your journey to homeownership today.