As we start 2020, it is time to ask the big question to ourselves, again – Should I Rent or Buy a Home in South Bay?
Taking into account that buying a home in South Bay or any other area in LA is undoubtedly the most important economic decision a family makes. So answering the question correctly is essential. Before the 2008 mortgage crisis, when mortgages were almost given away, the answer seemed clear- it was better to buy (of course, we all know what transpired later).
During the crisis, with banks giving very little credit, only those who came “covered” by their savings were able to get a housing loan. But we are way past the crisis, aren’t we? Without a doubt, the USA is still a country of owners. If as Americans we could choose and this doesn’t depend on our economic situation, most of us (if not all) would prefer to buy a house in South Bay.
To get an apropiated answer to the question Should I Buy or Rent a Home, we had to ask those who rented a house or an apartment, and we’d have our answer. According to statistics, at least six out of ten people still think that renting a home is not profitable in the long term. Or in other words, we are well aware that renting is throwing money away.
The madness of renting, if you must say
If that assertion has some truth in it, now is the time that truth is in full effect. The cost of renting a home in the big cities in California has gone through the roof. Los Angeles, in this regard, is a real madhouse.
According to this CBS News story, the price of rents has increased by 84% in Los Angeles since 2010. In 2013, a rented of an apartment of 80 square meters in LA could be for $600 per month on average, and in 2017, it rose to$900.
Of course, all those variables are trigger if we spoke only of the big cities such as Los Angeles and San Francisco. In the past four years, these markets have witnessed a significant turnaround, that hasn’t been for good.
When we did this research, should I Rent or Buy a Home in South Bay, data gathered by real estate tracker CoStar says that the average price of housing rental in The City of Angels rose by approximately 2.5% in March 2019, compared to a year earlier.
The good news is that while the rents seem to touch the roof in Los Angeles, the overall market reflects two speeds. This means that rents in medium or small cities have not experienced this boom, because the demand is not so much. And because people have not had many reasons to speculate (the effects of low-cost tourism).
Should I Rent or Buy a Home in South Bay? The logical decision is to buy
Buying a house in Los Angeles can seem complicated at first, but the amount of financing options available makes it much more comfortable than we can imagine. The increasing rents have been burdensome for a lot of people considering the city’s high cost of living (of which rent is a significant part). You can finance a home in LA with ease, and instead of paying for nothing for ten years, it’s always better to pay for the house’s owner.
Other than this, if you are an investor, the rising rents in the city that houses more than 4 million people, indicates only one thing, higher rental income.
So, as of now, and the short to medium-term future, we expect this trend to keep the same; which means higher rents translating into a higher cost of living for residents and higher income for investors. As things stand, ask yourself Should I Rent or Buy a Home in South Bay, doesn’t even sound much like a debate to us.
Looking to buy or sell a home in South Bay and other neighborhoods in LA? Contact Casa Bella properties today to help you find the best deal.
Blog Article curated and edited by Milena Bejarano