Kevin Concannon, buyer specialist for the Steven Cohen Team, discusses the pros and cons of renting vs. purchasing your next Boston home.
I frequently get clients who come to me trying to decide between renting and purchasing, often the same type of property and in the same neighborhood. Lately, I see more people lean toward purchasing than renting.
The number one reason I see consumers renting is for the flexibility. Not only do you have the option to move and follow an evolving career path into a different city after a few months or years, you're also not tied down to a long-term investment in Boston. Renting is also a great way to to figure your way around a neighborhood, try out a type of living-style - whether it be a brownstone or an elevator building - before you really invest in that part of the city. You might also want to rent while you save up for the down payment that's going to come with financing a mortgage one day. So it's either a flexibility or a money-saving decision.
But while there is definitely still value in renting, recently I'm seeing a shift. The incentives to purchase are a little more obvious these days. People want to have more control over what they do with the property. They also see the direction Boston's real estate market is headed and they want to be a part of that appreciation. They want to build equity. They'd rather pay interest now, when it's so low, versus paying into an owner's equity. And signing a lease often includes paying first and last month's rent, a security deposit, and a broker fee. People start to think that if they are already paying so much for a rental, maybe they can afford a 5% or 10% down payment to purchase a home.
And a counter to the flexibility point of rentals is that you can always move to San Francisco and get that amazing new job, and just rent the place out. Granted, not everyone wants to be a landlord, be tied to Boston, and take that tenant phone call when the dishwasher breaks. But become a landlord, and you have the flexibility to move in a year even if you purchase your Boston home.
To learn more about renting vs. purchasing your home in Boston, email Kevin at firstname.lastname@example.org or call the Steven Cohen Team office at 617.861.3636.