Whether you’re moving to a new city, your lease is up or you’re going through a major life change (newly graduated, just married or divorced) the decision of whether to buy or rent is a big one, and rarely has to do with just numbers—but here are the facts:
In Denver, the average monthly rent is at an all time high—the Colorado Division of Housing reports that the average monthly rent increased $63 this year to $1,041 (source). In addition, there’s not that much inventory to rent, and while there are new developments being built, the demand has continued to outweigh our supply—which means monthly rent in Denver will most likely remain high.
As of February 2014, it is 43% cheaper to buy a residence than to rent one in Denver (source). Nationwide, buying a residence is 38% cheaper than renting.
Purchasing a property has several benefits—you’ll build equity and receive the current tax benefit of mortgage interest deduction. You’ll increase wealth through appreciation. You’ll have the ability to personalize your place, and own any pet your heart desires. However, buying isn’t right for all situations. If you’re thinking you may need to move in the near future, renting may be your best bet. If you don’t want your funds to be tied up, or are in debt, it also may be best to rent. Renting is less risky as no one really knows where the status of the market will be in the future. With less risk however, comes less reward—or none at all. Before making the decision, consider how it will affect your personal and financial lifestyle—
Flexibility and freedom- moving is as easy as breaking a lease
No maintenance- call the landlord when your toilet breaks
No equity accumulation
Restrictions on certain lifestyle choices (pets, parties etc.)
Create wealth through appreciation
Personalize your place
Benefit from a mortgage interest write-off
No one is going to come and take care of your home for free
Tied down to a monthly payment until you choose to sell
Less access to money
Home Insurance costs
If you’re moving to Denver and are in need of direction or advice, please reach out to us. We’d love to help. Also, check out our neighborhood guides; they give great insight to finding an area that is right for you.