Realtors' brochure compares renting, buying

A recently revised NAR education brochure challenges assumptions about renting versus buying.

The brochure, available in English and Spanish, is designed to help Realtors evaluate their clients and to better determine if homeownership is right for them.

“Housing is a good investment, and owning a home makes sense for a lot of current renters, but many would-be homeowners are reluctant to take those first steps,” NAR President Thomas M. Stevens in a news release.

“Realtors can counsel consumers about their options and provide the information and support people need to begin their journey toward homeownership,” he added.

The Federal Reserve Board estimates that homeowners have a net worth nearly 36 times that of renters.

In the past 10 years, the cost of rental housing in the United States has increased an average of 3 percent per year; average rents are projected to rise 4.1 percent in 2006.

With a 3 percent annual increase, a current rental payment of $1,000 per month would increase every year and amount to $137,567 after 10 years, with no wealth accumulation.

By comparison, a $210,000 home purchased today with a down payment of $10,000 and a 30-year fixed rate mortgage at 6.5 percent would cost a steady $1,100 per month and yield a net worth of $138,521 after 10 years, assuming an historic 4.5 percent annual appreciation rate.

“The decision to become a homeowner involves financial and emotional considerations,” Stevens added.

The brochure is available by calling (800) 874-6500. [[In-content Ad]]