The strengthening housing market–especially on the East and West Coasts—may be setting some buyers up for another fall.
As The New York Times reports , prices in locations like the San Francisco Bay area and New York City have bounced back so strongly from the lows of 2008-2010 that, for many people, renting now makes more financial sense than buying. “In the country’s most expensive places . . . buying a home again looks like a perilous investment, based on the relationship between prices and rents or incomes,” the Times said.
Of course, buying a home isn’t just a straightforward dollars-and-cents calculation. When I consult with clients on this issue, we run the numbers, but we also spend time talking about the emotional issues of being tied to a piece of property, how long the clients want or expect to live in the same place, their ages, and other factors that may not have dollar amounts directly attached but which are important nonetheless.
For the dollars-and-cents part of the equation, though, the Times’ article also has a link to an excellent calculator that lets you plug in a bunch of variables to figure out your own potential owner-vs.-renter costs.