The eviction moratorium has just reached its end and Arizona renters hopefully will be receiving more federal funding to help them cover the cost of moving.
Arizona is a state with a lot of rental properties, but unfortunately, many of them are in dangerous eviction situations. Some landlords work with tenants and are waiting for state and federal aid.
There are many reasons why landlords may need to work with tenants. Landlords could be waiting for state and federal aid, or they may want to fix up the property if it is in disrepair. Whatever the reason, there are some things that landlords should remember when working with tenants. They are families and some will pay rent again when they get on their feet.
According to Zillow, 31,000 more renter households in Arizona are at risk of eviction now than last month. This is a frightening development for those living in Arizona who are part of the CDC ban on evictions.
What will this do to the rental Market?
Rental prices reached an all time high in many areas of the US according to a recent report. There are a few factors that contributed to this rise including employment growth, population growth, and average rent prices.
If you're a renter, now may be a good time to purchase a home. Prices for real estate have been increasing over the past few years and you should take that into consideration.
Monthly Rents tend to be Higher Than Monthly Home Mortgage Payments
The first thing that comes to mind when you think about renting is a financial burden. You might think that the monthly cost of rent is higher than your monthly mortgage payments, but this isn't always true.
Renters are often surprised to find out how much they're spending on their landlord each month. This is because many landlords do not include the cost of utilities in their monthly rent amount. Some even add additional fees for parking, cable TV, or internet service as well!
Typically, your security deposit will cover the cost of utilities and these extra fees for a month or two at most. When you break down the long-term costs though, it's clear that renting might actually be significantly more expensive then owning a home.
Living in a place that you know you can't afford is something that many people find themselves faced with. Renting monthly is a way to avoid the high costs of coming up with a down payment to buy a home.
A recent study shows that renters are spending more than the monthly mortgage payment on rent. For the purpose of this study, they looked at over 1 million rental listings and found out that many landlords are asking for upwards of $500 dollars on top each month.
This could create an issue if you decide to move locations and need to find another apartment. There's no guarantee that your new landlord will be willing to charge less than your previous landlord did which could mean having to leave your current location without any guarantee for finding another affordable rental in time before it would be too late.
When you're weighing your options between renting & buying a home, how much you'll be paying each month likely comes to mind first.
The monthly mortgage payment to buy a home is rising as more demand from buyers arise, but it’s still significantly lower than the typical rental payments. NAR shows that the latest median monthly mortgage payments are $1,204. The median US rent is $1,575 according to the most recent data on realtor.com
According to a recent study, buyers who recently purchased a home locked in a monthly payment that is, on average, $371 lower than what renters pay today (see graph below).
Recent rent increases may be difficult to manage, looking at the history you should see that rents should continue to rise in the coming years.
Today, buying a home costs less than renting, but there's no guarantee that this will always be the case. Renting costs are subject to changes in the market that aren't as predictable as home prices. Or fixed rate mortgages.
Since 1988, the median asking rent has steadily increased as shown in this graph:
Since the start of the 1980s, homeownership is steadily increasing in popularity. This is likely due to the fact that renting prices have steadily increased over time, which creates a major disadvantage for renters.
Renters are more likely to be in unstable housing situations where they're constantly looking for places that they can afford and not feel like they'll be kicked out anytime soon.
Renters face increasing costs every year due to the rising cost of housing.
When you're buying a home, there are a lot of factors to be considered such as the area where you want to live and the quality of your new purchase. One thing that many people forget to consider, however, is the monthly payment on their mortgage. If you plan on staying in your home for 30 years or more, then purchasing a low-interest fixed rate mortgage is important. So the payment stays locked in for a long period of time.
Renters are left scrambling to find ways to save money on a month-to-month basis.
Yes, you are able to lock your rates! This will give you peace of mind if you purchase a home that you're qualified for the payment.
Bottom Line
Rents are rising and can be a significant financial burden. It's important to consider whether now is the right time for you to buy vs. renting or saving money and buying later. Let's discuss your options so you can decide best for you!
