Rental Prices are Increasing too

Home prices nationally are beginning to moderate, but here in Houston we are still seeing a strong Home Sales market. 

• Job market is strong and stable allowing more people to afford a home and also upgrade to larger homes as their families grow.
• Texas has become a destination to move to for a more favorable job market and more conservative living.

These and other factors reduce our inventory of homes for sale causing multiple offers on new listings to remain high. 

Along with high occupancy rates in Apartments, home rental rates have risen to record levels and are increasing.  Just two years ago, home rental rates held steady at approximately 0.75/SF. Now rates are anywhere from 0.90 to 1.25/SF.

It common to see multiple offers on Home Rental listings.  Typically investors would buy resale homes and negotiate on the price. Now many investors are buying new construction and regular prices.

These higher prices are creating problems for First-Time Home Buyers.  The higher rent reduces the money needed to save for a down payment.  It’s also unstable for their home budgets as their rent will continue to increase if this economy continues.  As renters continue to save for a home, interest rates are increasing which further erodes their buying power.

Many Buyers are forced to rent until a home they can afford becomes available.

Fannie Mae will soon consider rental payment history to qualify buyers. Not much of a help, but at least it’s something positive.

Selling first and renting before buying has become necessary.  To be competitive in Multiple Offers:

• Buyers will be in a more favorable position if they do not have a home to sell in order to buy
• Buyers will have the cash on hand for higher down payments
• Buyers will have more time to find a home that suits them more than having to choose from what is available at that time

These factors have made home rental more competitive.

It’s hard to determine if it’s best to Rent or Buy. Lately the decision is made for you. With few homes available, you may have to rent.    

The Boutwell Team is very experienced in threading the needle to coordinate a home sale and home purchase. There are many options we excel at including temporary leasebacks, negotiating closing dates for both sides to work out best timeframe,  and working with mortgage companies with services that help in combining selling and buying so you can make a cash purchase of new home.

Contact us so we can guide you through the process. If you have questions, we are REDDY to help.