Think It’s Wise To Rent in Port Jefferson or Three Village? Think Again.

I am sorry, but I have to disagree with Suze Orman this time.  She said something last Friday evening during the Bill Maher Show on HBO that shocked me!

Here’s her comment on the housing market: 

“We now have an America that doesn’t even think that they want to own a home anymore; they’re under water in their homes, and they are praying that somebody will just take it off of their hands so that they can rent.”

I understand that there are some families trapped in a house they cannot sell, but to say that Americans no longer believe in homeownership, is just not true.

Here are a couple of findings from recent surveys:

96% of all homeowners (and even 93% of all homeowners that are currently underwater) believe that homeownership has been a positive experience.

84% of Americans and 70% of renters believe homeownership is a better alternative than renting.

63% of renters have aspirations to someday be a homeowner.

64% of Americans think buying a home is a safe investment. (A safer investment than stocks or government bonds)

When asked which investment is currently showing the most potential, more Americans picked buying a home than ANY OTHER INVESTMENT (stocks, bonds, mutual funds, etc.)

IN A NUT SHELL– 67% of homeowners, 55% of renters and even 75% of those homeowners underwater believe it is a good time to buy a home.

Suze Orman may believe that families in this country now prefer renting over owning. Surveys say the exact opposite!Americans still very much believe in owning their own home.

Currently, in most parts of the country, buying is less expensive than renting. Plus, purchasers can lock in their housing expense for the next thirty years by buying now. They will get a sensational price and a record low interest rate. What will happen if they continue to rent?

If a family continues to rent, they are looking at a housing expense which will rise with the market. Rental costs increase by 3% a year historically. But today’s rental market favors the landlord to a greater degree.  Above is a graph of how rental prices have increased recently and where they are projected to go over the next few years based on a report from Marcus & Millichap.