In a recent Forbes magazine study, Portland was named one of the top 10 cities in the nation where it is smarter to buy than rent. Market conditions are such that now is a particularly good time for some renters to become homeowners.
To rank the cities, Forbes computed the premium to buy—the spread between what a consumer would spend to rent and what they would pay for a mortgage—and also identified locales where economists predict home prices will go up the most over the next five years.
A family hoping to put down roots there would normally pay a 62% premium to go from renting to buying. In the third quarter of 2009, however, that premium shrank by 16 percentage points. At the same time, Moody’s Economy.com anticipates that home prices will jump 19% over the next five years.
That’s partly because Portland has strict government limitations on building and a coastal location that keep sprawl in check.
“Portland has one of the most controlled environments in the country in terms of development rights,” says Stuart Gabriel, director of the Ziman Center for Real Estate at the UCLA Anderson School of Management. “Those supply constraints will push prices up.”
Metropolitan Statistical Area: Portland-Vancouver-Beaverton
Premium to Buy, 15-year Average: 61.9%
Premium to Buy, Q3 2009: 46.4%
Five-year Home Price Index Forecast: 19.09%
Median Rent: $819
Median Home Price: $244,500
Blended Mortgage Rate: 5.17%
In 2009 Bella Casa’s Realtors® helped more buyers in Yamhill County purchase homes than any other real estate brokerage. If you are currently renting, give us a call and we can help you determine a wise course of action.
Perhaps 2010 will be YOUR year of HOMEOWNERSHIP!!
Article Source: Forbes Magazine