Is money management (and perhaps a general sense of ‘adulting’) included in your 2018 resolutions? If you’re ready to paint the walls, ditch coin laundry forever, and make your money work for you long-term, I invite you to consider the benefits of buying vs. renting now – before the landlord comes knocking with your summer lease renewal.
First, consider this. Let’s imagine you pay $1,500 for your monthly rent. How frequently do you think of your 12-month lease as “$18,000” sticker price? Probably never, right? Since rent is due 1st of the month, we assess its impact to our budget on a month-to-month basis. Well, a mortgage payment is really no different. And with low down payments increasingly common for first time buyers (61% of homebuyers put down 6% or less in 2017 nationally), how much would you really need in the bank to become your own landlord?
Second, back to three major financial benefits of home ownership: (1) costs are more predictable and stable than renting because they’re typically tied to a fixed-rate mortgage; (2) homes typically increase in value over time, building equity and providing a future nest egg, and (3) the mortgage interest and property tax portion of your monthly payment is a tax deduction.
Ready to dive in? Here’s a mere sampling of selected condo properties across Chicago – all under $250,000 sticker price – that each feature two bedrooms, at least one dedicated parking space, and central air conditioning. Most but not all include in-unit laundry, and all of these are active listings as of publishing Jan 23.
Lincoln Square: 4850 N Oakley #1R
– Sticker Price: $185,000
– $1,470 monthly / $9,250 down (5%)
– photo credit & presented by Fulton Grace
Irving Park: 3100 W Berteau #2
– Sticker Price: $194,500
– $1,275 monthly / $9,725 down (5%)
– photo credit & presented by Coldwell Banker
Ukrainian Village: 2346 W Augusta #2R
– Sticker Price: $235,000
– $1,554 monthly / $11,750 down (5%)
– photo credit & presented by Compass
Albany Park: 4527 N Central Park Ave #3
– Sticker Price: $244,900
– $1,717 monthly / $12,245 down (5%)
– photo credit & presented by Dream Town
Uptown: 4704 N Winthrop #2A
– Sticker Price: $249,000
– $1,687 monthly / $12,450 down (5%)
– photo credit & presented by Re/Max
Bonus tip: One of the often over-looked factors that can impact the actual monthly mortgage payment is your monthly Home Owners Association (HOA) fees. These fees pay for common elements like building insurance, water, trash removal and any other shared amenities like door or maintenance staff, gyms or pools and professional property management. That’s why some buildings with higher “sticker prices” may actually be less expensive (monthly) than other buildings with higher HOA costs.
If you’d like to learn more about qualifying with a lender, defining a budget, and starting your home search, message me today!