Renters get more bang for their buck

By Call it Crazy   Follow   Thu, 3 Jan 2013, 11:02am   731 views   8 comments
In Menlo Park CA 94025   Watch (1)   Share   Quote   Permalink   Like (1)   Dislike (1)  

The U.S. Census Bureau and the U.S. Department of Housing and Urban Development posted the survey results on the quality of housing in the nation, with the most interesting result being households pay more per month compared to renters.

On average, households pay $927 per month, or 24% of their household income for housing. The cost is higher for residents of new construction, with median cost of $1,340 per month, or 24% of household income.

Renters on the other hand, generally pay less in housing costs at $845 per month. Although, they usually pay a higher percentage of their household income, at 31% compared to 20% for owners.

Previously, real estate providers have posted opposite findings.

Viewing Comments 1-8 of 8     Last »     See most liked comments

  1. CaptainShuddup

    Befriend (1)
    1,120 threads

    1   11:09am Thu 3 Jan 2013   Share   Quote   Permalink   Like   Dislike (1)  

    Oh Really!?

    Here's my house on Zillow

    Zestimate $161,097 $118K – $237K +$2,262 $75 12/31/2012
    Rent Zestimate $1,584/mo $1.2K – $2K/mo +$44 $0.75 12/31/2012

    Notice the value says 161K, with a spread of 118-237K the tax roll says 119K but would likely sell for 148K if I were to actually try to sell it.
    I bought it at 160K and 4.75% $1200 mortgage, so I'm still paying more than $300 less than what it says it would rent for. Actually a 4 br house in my neighborhood rents for $1900. So says a few friends that are renting houses way smaller than mine.

    If someone were to buy my house today at 148K and 2.99% interest rate their payments would be about $1000 a month.

  2. Mobi

    1 threads

    2   1:01pm Thu 3 Jan 2013   Share   Quote   Permalink   Like (4)   Dislike  

    Not a surprise. The majority of the renters live in either apartments or smaller/crappier houses so that the median cost is lower (that's where the renting market is.) Also, renters as a whole have a lower income and more percentage of that income goes to housing. So, the title is misleading. Paying less does not necassarily mean more bang for their bucks.

  3. Philistine

    Los Angeles, CA

    3   2:08pm Thu 3 Jan 2013   Share   Quote   Permalink   Like (1)   Dislike  

    Mobi says

    Paying less does not necassarily mean more bang for their bucks

    They might be getting "banged" for their bucks. . . .

  4. mike2

    Befriend (2)
    8 threads
    El Cerrito, CA

    4   3:58am Mon 7 Jan 2013   Share   Quote   Permalink   Like   Dislike  

    FInally some readers that see that renting makes no sense most of th e time especailly in the long run. Just bc there were a few years of a down market a lot of doomsdayers were trying to say REis a bad investment and you could make more money on the Stock market etc.I have debated w these guys for years but they can't see it. Renting can be a good option if you cannot afford to buy, if you are in between jobs, or moving out of the area or just don't want to buy a home. Who likes having to move when your landlord says time to sell or having thier rents raised every few years bc the market keeps going up? Thee is no security in renting. Buying is not for everyone for sure..Renting is not a good long term solution.

  5. eastcoast guy


    5   7:59pm Wed 9 Jan 2013   Share   Quote   Permalink   Like (1)   Dislike  

    The numbers for average payment per household for home ownership appear to be quite low. Here in coastal northeast a reasonably decent house today costs at least 250K. In CT there is at least a 2.5% property tax to be paid. If I enter these numbers into a calculator using 3.2% interest rate for a 30 year fixed rate mortgage I come up with a mortgage not bigger than 80-90K for a housing payment of around $950/month (this does not include insurance and upkeep). This would mean that people living in reasonably decent houses here pay down about 150K (3/5th) of its price when they purchase or else they buy a much more modest house. The price of this modest house would be around 170K assuming a more realistic 20 % down payment and the numbers used before. Problem is that there are not that many houses, even modest ones, for 170K available here. So these numbers do not apply for this region at the present time. I would argue that the same goes for any coastal region of the US. Since these regions contain the majority of the population in the US I wonder if the numbers given in this article are that low because they contain in its majority households that bought well before the big bubble. As for today- if you want to buy a house anywhere within 100miles or so of the US coast and expect to do this with a 20% down payment and a 950$ monthly payment good luck to you.

  6. EastCoastBubbleBoy

    Befriend (13)
    111 threads

    6   8:36pm Wed 9 Jan 2013   Share   Quote   Permalink   Like   Dislike  

    from article

    On average, households pay $927 per month, or 24% of their household income for housing.

    What is a housing expense? P&I obviously - but what of taxes, insurance, maintenance, extra utilities that a renter need not typical cover?

    Plus, of $927/month is 24% of ones house hold income (gross assumed) then the average pay for an owner occupied housing unit would only be $46,350/year. Seems low to me.

  7. BoboTheClown44114


    7   9:03pm Wed 9 Jan 2013   Share   Quote   Permalink   Like   Dislike  

    I think it depends on where you live.

    Here in Cleveland Metro Area it is much cheaper to own than rent. I bought a nice 1350 sq ft 1950s ranch house here for 41K. My payment is $560 (prin+int+taxes) on a 10 yr loan. I could easily get $900 a month in rent for my place.

  8. Peter P

    Befriend (5)
    138 threads

    8   12:34am Thu 10 Jan 2013   Share   Quote   Permalink   Like   Dislike   Protected  

    Beware of lies, damned lies, statistics, and government statistics.

Call it Crazy is moderator of this thread.



Watch comments by email
Home   Tips and Tricks   Questions or suggestions? Mail   Thank you for your kind donations

Page took 14 milliseconds to create.