To Buy or Not to Buy - Qualified Buyers Can Afford to Say "Yes" in Las Vegas

"To buy or not to buy?" - that is the question many renters ask. The last time hoards of renters answered "Yes!" in the midst of the housing boom, they ended up with easy credit loans doomed for foreclosure. Then housing prices in Las Vegas went so high that homeownership was much more expensive than renting. Now that housing prices are coming down, mortgage rates are low for qualified buyers, and incentives are in place for buying, whether to buy now is an intriguing question for many tenants. Realtors are ready to point out to hesitant buyers that the numbers make the time favorable to buy.

Homebuying has always been about more than economics, as intangibles like the pride of ownership and family security, had a role in the decision to buy. Traditionally over the past 18 years, after tax mortgage payments were about 26% higher than rent. By 2006, when housing prices were severally inflated, the cost to own in some markets was as much as 66% more than the cost to rent. Many potential buyers deferred plans to buy and signed the lease for another year. By 2008, as housing process tumbled, the average after tax mortgage payment the 50 largest metropolitan areas was $1,300 as compared to rent of $1,045. The gap between renting and owning has now fallen to 24%. If mortgage interest rates fall to the predicted 4.5%, the own to rent ratio should fall to 14%.

In Las Vegas, the ratio is as low as it's been in 18 years. With plenty of available housing, including bank owned properties put on the market at low prices, buyers may do better than the average. In some cases, home seekers are finding that their mortgage payment will be less than their current rent which also skyrocketed along with home prices.

This makes it a great time for renters with good credit to buy homes for their families. At Prudential Americana, Yonas Woldu and Nebi Adhanom can show you affordable properties in Henderson and the Greater Las Vegas area. Check out our Vegasrealproperty website for a handy mortgage calculator so you can see how a mortgage payment would compare to your rent.