The Great Dilemma: Purchase versus Renting

Before you decide which option is best for you, whether it be homes for sale or rent, let’s look at the cost difference in upfront cash, monthly payments, repair and maintenance expenses and projected investment results before you make your decision to purchase or rent during your military tour at Fort Sam Houston, Texas. Please be assured, after you have considered all the benefits I present of home ownership over renting, and the timing just is not right for you and your family, I will be more than happy to assist you with finding a great rental home in the area.

 

 

This depends on the type of loan you and your lender decide is best for you. There are several loan types to choose from, with options available for you to purchase a home without having a down payment. In addition, there are several ways to include cash closing costs into a loan. 

 

Your monthly mortgage payment total will be a combination of several amounts. First, will be Principal and Interest based on the amount borrowed from a lender. Second, your lender will usually require you to escrow (which is a no-interest account they place it in) your property taxes and homeowners insurance premium. Finally, some conventional loans require mortgage insurance depending on the amount of money you put down. 

 

First of all, keep in mind you will have an opportunity to have a professional home inspection done on any property you buy. You’ll know up front of there are any major repair issues that you would be likely to inherit. You can cancel your contract if those issues are outside your level of comfort. In most cases, our standard contract requires the seller to repair any major items prior to closing and to ensure all systems, appliances, plumbing and electric are in operating condition on the day of closing. 

Most properties require a one-month security deposit and the first months’ rent to be paid with the application fee. Application fees range between $50-$75 and are non-refundable. Most rental properties do not accept pets. For those that do, pet deposits range between $250-$500.

 

Remember, you’re monthly rent amount is actually making your landlords mortgage payment AND will also include whatever profit margin required for that investment (typically between 10% - 20% mark up of what the landlord actually pays out of pocket for his investment you are helping to fund.

It is common for Landlords to charge a repair deductible of $50 - $100 per service calls for repairs. In addition, you will be required to provide liability insurance, “renters insurance”, for the rental property. This insurance is very affordable ($200/year) and is available from most major insurance carriers.

 

There are lots of benefits to home ownership to be considered before you decide to buy. From keeping your cherished pets, to being able to settle in to customize and decorate your own place without a Landlord’s approval, there are several areas to consider.

 

Interest and Real Estate taxes are tax-deductible expenses; rent is not. In addition, if you are active duty, you are receiving tax-free money provided by the government for your housing (BAH) to pay, or offset, your mortgage or rental payment. If you own your home, this means you are receiving tax-free money you are able to take a tax deduction with! 

 According to Fortune magazine, San Antonio was the nation’s best real estate market in 2006 and, in addition, the 2007 forecast still has it ranked in the top three cities to experience continued growth and appreciate at rates far above the national average. San Antonio home values are appreciating at an average between 4% - 7% a year, depending on location. That means the $175,000 home used in our earlier comparisons would actually appreciate between $580 and $1,025 every month! Another fantastic advantage is that most residential home sales are tax-free. This means that the financial gains you accumulate on your home over the years are tax-free, giving you additional tax-free savings to the ones previously mentioned.

 

As you can plainly see, compared to renters, homeowners will reap the benefits of savings for years to come. As I mentioned in my introduction, after you have considered all the benefits I present of home ownership over renting, and the timing just is not right for you and your family, I will be more than happy to be your local Realtor and assist you with finding a great rental home during your tour at Ft. Sam Houston. My husband and I have purchased and sold many properties over the years when relocating to the next duty station, and we can personally vouch it has been more than worth our while both financially and emotionally over the years. I truly look forward to helping you and your family find your perfect home and make your relocation to San Antonio as fun and stress-free as possible