Low mortgage rates and more affordable home prices in the Roanoke Valley are creating an interest in homeownership by those who live in apartments. However, potential buyers who are unprepared for the true cost of owning a home may be shocked by the bite home ownership can take out of their wallet in addition to their mortgage payments.
Inspection and Appraisal Fees
Before you purchase a home you need to pay for a home inspection, and an appraisal, possible even inspections for pests or radon. The costs of these inspections are borne by buyers and are a necessary protection to avoid buying a flawed property or paying too much.
Closing Costs
Buyers need to be prepared with the cash for anywhere from 2% to 4% of the mortgage balance depending on your area.
Taxes
As a homeowner, you'll need to pay property taxes, which are generally part of the escrow you pay into each month. Remember, even if you have a fixed-rate home loan, your property taxes could go up and increase your monthly housing costs.
Insurance
Your lender will require home insurance, the cost of which depends on factors including the construction materials of your home and the location. Even if you have renter's insurance, you'll find that home insurance costs more because you are paying for the ability to rebuild your home in addition to replacing your personal possessions. Insurance costs will rise over time, and you will need supplemental insurance if you live in a flood zone.
HOA and Condo Fees
If you buy a home within a homeowners' association or a condominium association, you'll be required to pay a monthly or quarterly fee. These fees can rise, or your association may need to charge a special assessment for projects such as repaving the parking lot or repairing a roof.
Utility Bills
Depending on where you live, your costs for electricity, gas and water could be higher when you move into your own home than when you live in an apartment in Roanoke, VA. You may also need to pay for garbage collection along with your Internet, cable and phone bill.
Furniture
While this is essentially a discretionary expense, most people who move from an apartment to a larger home need to buy at least some new furniture.
Lawn Care
Whether you handle your yard work yourself or hire a professional, you will have to pay something to keep your landscaping in check. Lawn equipment can be costly and you may need a leaf blower and other yard tools, too.
Maintenance
Home maintenance costs time and money. While you may be able to change your furnace filters, clean your gutters and keep your appliances running smoothly yourself, you may also need to hire a contractor to clean and inspect your chimney and to keep your heating and air conditioning system in top shape.
Repairs
While maintenance tasks can be predictable, the most costly part of home ownership typically comes with unexpected repairs such as replacing or repairing the roof, removing a tree, or paying for mold mitigation in a damp basement. The list of possibilities is endless, so homeowners should set aside savings for an emergency. Experts suggest budgeting for 1% or 2% of your mortgage balance as a yearly maintenance and repair fund.
The Bottom Line
Buying a home costs more than you think. If you don’t expect to stay in your home for at least seven to 10 years, contact Pebble Creek Apartment Homes.
House prices are low and mortgage rates are too, many say it is time to buy a home. But in an upside down real estate market, is it really more cost-effective to own as opposed to renting? Interest rates are lower, house prices are down, but it's also harder to get financed.
Many renters today have gotten out of a mortgage. Others are renting so they are not tied down to such a large payment every month.
Whether you should rent or buy depends on many factors, like how long you plan to stay in your home. Some experts will tell you buying is better than renting only if you plan to be in your house more than five years.
If you don't need the tax help, which is minimal, you may want to rent. Most of the time, and always at Pebble Creek, apartments in Roanoke, VA, the landlord will fix a kitchen sink which saves the renter out of pocket money.
Here's one pro and con breakdown:
Pros to Buying a House:
Emotional satisfaction of owning your own home.
It builds equity, (but it takes awhile).
You can get a tax break if you deduct your mortgage interest and your property taxes.
Cons to Buying a House:
Homeowners have to pay property taxes
Homeowners have to pay for maintenance and upkeep.
There's less flexibility if you decide to move.
Down payments are often 20% of the purchase price (if you want to avoid mortgage insurance). That's money that could have been invested elsewhere.
Lastly, most experts say the value of properties won't go up soon. When they do, since selling your house with a realtor normally comes with a 6% commission, values must go up by at least 6% JUST to break even, that does not take into account closing costs.
Buying at today's prices doesn't necessarily mean your house will be worth more in a couple of years. Whether it's worth the risk to buy is something each person needs to figure out for their unique situation.
Searching for a new apartment is not easy, especially in a city like Roanoke, VA where you have lots of options. Before you begin your apartment search, consider if you want a small apartment community or a larger one? Which apartment floor plan would work best for you? Think about which apartment amenities are important to you in an apartment community.
Here are some suggestions on how to simplify your apartment search.
Consider location
Try pinpointing an area in or around Roanoke that you want to live near such as your workplace or your favorite neighborhood, and search within a 1-mile or 5-mile radius of that location for apartment communities. Apartments in Roanoke, VA offer an easy commute and a wonderful community setting.
Use tools on online listings
Many apartment communities post apartment floor plans and photos online. Looking at images of floor plans and apartment amenities and features may help you decide what communities you want to visit.
What don’t you like about where you live now
When you make a list of what you don’t like about your apartment now, this will help you keep priorities top of mind. Don’t look at apartments that have those same features. Do you need more space? A larger kitchen? Do you need a community that allows pets? Do you need extra storage space? Or a pool? A well-kept fitness center?
Keep track
Make a spreadsheet that lists each community’s name, rent, amount of space, most important apartment amenities, and any other important facts or notes.
Many people are told when they are younger that renting is only for college graduates or people who cannot afford to buy. Many parents hammer these ideas into their children and tell them that renting is equivalent to throwing money away every month. Fortunately, today people are beginning to finally think for themselves and challenge these ideas. Here are 4 reasons to pat yourself on the back for deciding to rent an apartment in Roanoke, VA at an HHHunt Community!
1. Renting can save money
At the very minimum you’ll be shelling out PITI for your home. That is:
1. Principal
2. Interest
3. Tax
4. Insurance
The PITI doesn’t include property maintenance like maintaining the yard, paint, plumbing, repairs, decorating, etc… When you rent an apartment in Roanokeat an HHHunt community, the monthly payment is almost always quite a bit less than the PITI in your area and there are no maintenance expenses!
2. Homeowners’ tax deductions are overstated
According to research quoted by MSN, “… half of homeowners don’t get a break, because even with mortgage interest and property taxes, their total deductions do not exceed the standard federal tax deduction ($11,900 for couples and $5,450 for singles)”.
For these folks, it’s like spending $100 to save $20. They’re better off saving the difference and investing it. Even if there is a “break” on your taxes, you typically had to spend more than you would have spent to rent to get back that $20 for every $100 spent in interest payments.
3. Renting gives you flexibility
For the up and coming young professional, you’re better off renting and saving for a few years than to buy a small condo. Who knows how fast you will outgrow it? When you own a home, you can’t always sell it when you need to sell it at the price you want to sell it in order to accept a new employment opportunity. If you have owned a home and don’t want the constant maintenance responsibility, renting gives you the opportunity to enjoy your weekends instead of completing that “to do” list.
4. Our superb service teams!
Most apartment communitiesoffer 24 hour emergency maintenance and technicians who are skilled in HVAC, plumbing, and electrical. At an HHHunt Community, our service teams take great pride in offering prompt and professional service to you. Whether you need a light bulb changed or a new compressor for your AC unit, we are there to take care of you as fast and efficient as possible. We are always a phone call or email away and most service requests are performed on the same day or within 24 hours!
The common opinion is that making a rent payment instead of a mortgage or purchasing is like “throwing the money in the wastebasket.” At some point in time before the recession, homes were incorrectly considered an investment that would “always” go up rather than one that “may” go up.
When you consider all the pros and cons, buying may not be the best choice in all situations.
Avoid big money commitments: Usually, one can rent anapartment in Roanoke, VAfor the same or less than the cost of buying and they don’t have to come up with large fees like closing costs or taxes. Also, if a mortgage is taken out, the first several years of payment are dedicated mostly to the interest, not the principal.
Many apartment communities cover the costs of maintenance, landscaping and general repairs that a buyer would be responsible for themselves. A renter’s biggest expenditures are often moving and furnishings.
Flexibility: Since renting requires no substantial long-term investment, the renter has choices more often about their living situation. Moving from a bought home involves planning and costs such as commissions to real estate brokers. Also, if a home buyer wanted to sell, they could be at the mercy of the markets or not be able to sell their home at a profit.
If house values continue to decline, the worst scenario for a renter is only paying until their lease expires. People who rent can’t place a value on having that freedom.
Investment Considerations: Large down payments or home purchases can make it difficult for home buyers to maintain savings and investments specified for retirement and related activities.
In some cases, the money saved by not buying could outweigh the money earned on a purchased home, depending on the investment and property appreciation. For a home buyer, the risk is higher if an unexpected sickness or injury occurs causing financial strain.
The rent vs. buy decision is more than comparing lease and mortgage payments. The reality is there are pluses and minuses to each option.
If you are searching for an apartment in Roanoke, VA and you are on the go, take advantage of mobile technology to make your apartment search more efficient and more effective. Mobile search is available literally at your fingertips. Check your toolbox
You may currently use mobile technology for everything from checking the weather to downloading movies, but have you thought about how you can go mobile with your apartment search? GPS and mapping tools simplify your search by pinpointing apartments that are in Roanoke or in a desired area. And many apartment communities and apartment search guides have a Facebook page where you can get a quick overview of what tenants are saying and what an appartment community has to offer.
After find a potential apartment, use mobile technology to instantly go online where you can read reviews and compare communities to others nearby. Use your mobile device to jot down notes electronically and take pictures. Then you can e-mail pictures and thoughts directly to your partner, roommate or friends.
No apartment search would be complete without submitting an application, which you can also quickly do from your mobile device once you find your dream apartment. That way other renters won’t beat you to the punch!
Socialize your search
Taking advantage of mobile technology can help you locate, preview and contact apartment communities. Before you sign the contract, you may want to go mobile to get opinions on your decision. Logging in to Facebook on your smartphone gives you quick access to your friends so you can post questions about your apartment choice and get immediate feedback.
Making a move and choosing a new apartment in Roanoke can be challenging, so maximize your mobile technology to make decisions faster and get a jump on the hottest apartments on the market.
One of the most popular home ownership myths in Roanoke, VA is that owning a house is a huge tax break as compared to renting. I don’t know how many times people have personally told me that they want to buy a home because they NEED a tax deduction! I just shake my head in disbelief because I have done the math.
If your mortgage interest and other qualifying expenses such as charity contributions aren’t more than the standard deduction, ($11,600 for joint filers in 2011), there is no tax advantage to owning a home as opposed to renting an apartment in Roanoke, VA. Assume that you buy a $200,000 house with a 5% downpayment at a 6% interest rate. Your mortgage interest for the year would be $11,336. The Standard Deduction for joint filers is $11,600.
In this example, there is NO TAX BENEFIT. Even when there is a tax benefit, you most likely paid much more money to maintain the house than you are saving in taxes. If your mortgage interest is more than the standard deduction and you choose to itemize, there is little to no advantage.
For example, assume that your mortgage interest in 2011 is $15,000. You would get to deduct an additional $3400 if you itemize BUT you spent $15,000 in mortgage interest to save $850 on your taxes (assuming 25% tax bracket).
Don’t forget that you would also have all of the other expenses of home ownership that you would not have incurred when renting an apartment in Roanoke, VA in an HHHunt community.
Many people can tell you a list of reasons why you should buy a home. But that really depends on who and where you are in your life as well as your career. Despite the prevailing idea that everybody should settle down and buy their own home, research shows there are actually times and circumstances when renting an apartment in Roanoke, VA might be a better idea.
Will you put in the time?
In any investment, there's no such thing as a sure thing. What usually makes real estate a better risk than most is time. The longer you commit to a property, the better your chances of seeing its value appreciate.
If it is likely in any way that you will move, change jobs or stay in the house for a short period of time, buying may not be a good idea. Letting go of a property before it has appreciated enough to cover the costs and commissions is not pleasant and if you bought with less than a 10% down payment, it could be brutal. Commission and closing costs will likely wipe out appreciation gains, if there were any. If the purchase was made with an even smaller down payment, chances are you'll come out at a substantial loss.
Will you like the neighborhood?
If you are new to a state, city or town such as Roanoke, research suggests you take ample time to acclimatize before investing money in a house and its neighborhood. If you are relocating to a place you hardly know, spend a year in an apartment in Roanoke until you're certain where and how you want to live.
Will you be happy giving up the freedom?
Initially at least, rentingis less financial pressure than buying. Paying a first and last deposit doesn't compare to the big chunk of change required for a down payment on a house. And even if you have enough savings, you could invest it otherwise and hope for significant capital gains. With current market volatility that may not seem prudent, but just imagine if you'd invested a typical down payment amount in the stock market ten years ago.
Renting gives you the freedom of time as well, with no yard or home maintenance projects. Renting is also lower risk because natural and other disasters the problems of the landlords.
Even though rents tend to increase by 3 percent a year, unexpected maintenance costs or sudden property tax hikes don't concern you either.
Relocating to Roanoke, VA? You should look at Pebble Creek apartments, contact us.
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Low mortgage rates and more affordable home prices in the Roanoke Valley are creating an interest in homeownership by those who live in apartments. However, potential buyers who are unprepared for the true cost of owning a home may be shocked by the bite home ownership can take out of their wallet in addition to their mortgage payments.
House prices are low and mortgage rates are too, many say it is time to buy a home. But in an upside down real estate market, is it really more cost-effective to own as opposed to renting? Interest rates are lower, house prices are down, but it's also harder to get financed.
Searching for a 
Will you put in the time?
