The housing market is still going strong in 2022 and is predicted to keep going throughout this year. Last year saw a crazy housing market with unexpected shortages of homes for sale. The shortage along with historically low mortgage rates made it a seller’s market. Many who were thinking or actively looking to purchase a home in 2021 put the search on hold. According to professionals in the industry, now is the time to stop pouring money into a rental and put it into owning a home.
Rental rates are on the rise and it is predicted that 2022 will see them go up even more. The median price for a one-bedroom rental increased 12.1% in 2021. Normal increases that have been seen in the past are 0.3% in 2019 and 0.6% in 2020. Here are a few reasons why renting this year is not a good idea.
The last two years we have had eviction moratoriums due to the COVID-19 pandemic. This year those will be ending and landlords will want to make up the money they lost the last couple of years. Landlords will be able to once again evict tenants who are late on their rent. Landlords will raise the rent accordingly to make up for those losses from the pandemic.
Since the housing market is hot and buyers are competing for more than ever in bidding wars, landlords are using this to their advantage. They are playing off the soaring house prices and low inventory. This will also drive the rental prices up because of the high demand. Property management companies are over more and more rentals and are strict and not as easy to negotiate pricing.
If you are renting, there are many disadvantages that outweigh the cost of buying a home. The historically low mortgage rates will not be here forever. The industry is already seeing a little increase in the rates and they are expected to keep going up. When renting you are just throwing away your money instead of putting your money towards home through a mortgage. That means you will get your money back when you sell.
If you are interested in purchasing a home, now is the time. Remember to choose a Realtor who can help you navigate the unpredictable market. There are too many advantages to owning a home instead of throwing your money away in rent.