It’s the perpetual question for potential homebuyers: does it make more sense to rent or to buy real estate? With the market still experiencing volatility in some regions, there are certainly some areas that could make the case for renting over buying. An article in last week’s New York Times looked at the rent ratios (average home price divided by annual rent) in major U.S. cities. Higher rent ratios mean that home values are high, compared to the cost of renting—buying is the more cost-effective option when cities have a rent ratio of 15 or below. The Chicago real estate market continues to show the value of purchasing now.
Chicago real estate versus U.S. cities
In the New York Times’ analysis, Chicago fared much lower than other metropolitan areas. With a rent ratio of 15, Chicago homes for sale are considered to be priced low, offering potential buyers more “bang for their buck” with a real estate purchase versus making rent payments.
Here’s a look at the rent ratios for major areas:
San Francisco: 27.1
Washington D.C.: 18.9
New York (Manhattan): 29.2
New York (Long Island): 21.5
Those coming from other large cities and considering a Chicago real estate purchase will be surprised at how much buyers get for their real estate dollar—equivalent real estate in one of these cities would be almost 2.5 to 3 times what one would be spending in New York, San Francisco, etc.
Making a Chicago real estate purchase now
For buyers searching Chicago homes for sale for a place to live for the near future (five years or more), buying certainly makes the most sense. Prices are about as low as they will get, sellers are eager, mortgage rates are competitive, and the market now is unlike anything we’ll see again in our lifetimes. If you have a down payment and the credit history to back up a mortgage loan, this is an opportunity quickly passing by.
Give me a call or send me an email and let me know what you’re looking for. I’ll be happy to find Chicago homes for sale that meet what you’re looking for and help you take advantage of this unique chance for buyers. Contact me at 312-264-5853 or by email at firstname.lastname@example.org.