Families are thinking about 2025, and Orion’s brokers are hearing from their clients, “Should I keep renting, or should I buy?” For brokers this is a recurring question of anyone with a landlord. The answer to that question is most assuredly, your client should buy. Some brokers will say, “You’re paying $3,000 a month in rent. Even if the rent doesn’t go up, that is $36,000 a year, $360,000 over ten years, with no tax advantages and straight out of your pocket. Compare that to10 percent down on a $400,000 home, or $40,000, and the appreciation and tax advantages in building wealth.”

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That being said, increasing numbers of renters these days are not taking action. Some believe that we will see another real estate bubble, or another recession. But it could also be likely that renters simply don’t realize that they can afford to buy. Here are some reasons why buying can be both attainable and affordable, and why now may be a smart time for your client to consider homeownership.

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Unlike renting, buying a residence is an investment. Every time your client pays their mortgage, they are increasing the equity in their home and their own financial wealth, versus paying rent, which is only increasing the landlord’s financial wealth. Moreover, rent payments in many U.S. markets are increasing each year, but the payment on a 30-year, fixed-rate mortgage doesn’t increase.

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It’s good to remind your clients that a seemingly small increase in the value of a home can translate into a high percentage return on a borrower’s investment. For example, a borrower purchasing a $100,000 home and putting 20% down or investing $20,000 would actually enjoy a 22% return on their investment if the home grew just 4.4%. Incomes are ahead of home prices and relatively low interest rates help affordable ownership.

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The numbers make a solid case: owning could very well be the better option and is achievable for qualified borrowers. One of the main things keeping renters from being owners is that they haven’t done the research or reached out to learn more about how they may be able to finance a home. Of course, insurance and property taxes must be looked at as well as the loan; this is where a skilled broker can help. Invite questions from your clients!

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