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Is It Better To Rent or Buy a Home?

You’ve probably asked yourself lately: Is it even worth trying to buy a home right now?

With high home prices and stubborn mortgage rates, renting can seem like the safer choice right now. Or maybe your only choice. That’s a very real feeling. And perhaps buying today isn’t your best move; it’s not for everyone right away. You should only buy a home when you’re ready and able to do it, and if the timing is right for you.

But here’s the thing you need to know about renting.

While it may feel like a safer bet today – and in some areas might even be less expensive month-to-month than owning – it can really cost you more over time.

In fact, a recent Bank of America survey found that 70% of aspiring homeowners worry about what long-term renting means for their future. And they’re not wrong.

Owning a home may seem way out of reach, but if you make a plan now and steadily work toward it, homeownership comes with serious long-term financial benefits.

Homeownership Builds Wealth Over Time

Buying a home isn’t just about having a place to live – it’s a step toward building your future wealth.

Why? Home prices typically rise over time, which means the longer you wait, the more expensive it is to buy. And even in some markets where home prices are softening today, the overall long-term trend speaks for itself (see graph below):

And as home values rise, so does your equity when you’re a homeowner. That’s the difference between what your home is worth and what you owe. So, with every mortgage payment, that equity grows. Over time, that becomes part of your net worth.

Today, the average homeowner’s net worth is nearly 40X greater than that of a renter. That’s a shocking difference, and the dollars in the visual below don’t lie (see graph below):

And it’s one of the big reasons why Forbes says:

“While renting might seem like [the] less stressful option . . . owning a home is still a cornerstone of the American dream and a proven strategy for building long-term wealth.”

The Biggest Downside of Renting

So, short-term, why does renting feel like a simpler choice? Lower monthly payments, less responsibility, no strings attached. But long-term? It can sting.

For decades, while home prices have been rising, rent has gone up too. And while rent has held rather steady more recently, history shows the overall trend is up and to the right. That makes saving for a home more complicated than ever (see graph below):

That kind of financial uncertainty has a real impact. In the same Bank of America survey, 72% of potential buyers said they worry rising rent could affect their current and long-term finances.

Because rent doesn’t build wealth. It doesn’t come back to you later. It pays your landlord’s mortgage – not yours.

So, whether you rent or own, you’re paying a mortgage. The question is: whose mortgage do you want to pay?

Renting vs. Buying: What Really Matters

Think of it this way. Renting means your money is gone once you pay it. Owning means your payment builds equity – like a savings account you can live in. Sure, buying comes with responsibility. But it also comes with the kind of reward that grows over time. And that’s why you need a solid plan to get there.

As Joel Berner, Senior Economist at Realtor.com, explains:

“Households working on their budget will find it much easier to continue to rent than to go through the expenses of homeownership. However, they need to consider the equity and generational wealth they can build up by owning a home that they can’t by renting it. In the long run, buying a home may be a better investment even if the short-run costs seem prohibitive.”

Bottom Line

Renting may feel more do-able today. But over time, it could cost you more – without helping you build anything for your future.

Many Veterans Don’t Know about This VA Home Loan Benefit

For 80 years, Veterans Affairs (VA) home loans have helped countless Veterans buy a home. But even though a lot of Veterans have access to this powerful program, the majority don't know about one of its core benefits.

According to a report from Veterans United only 3 in 10 Veterans are aware they may be able to buy a home with no down payment with a VA loan (see visual below):

That means 7 out of every 10 Veterans could be missing out on a key homebuying advantage.

That’s why it’s so important for Veterans, and anyone who cares about a Veteran, to be aware of this program. As Veterans United explains, VA home loans:

“. . . come with a list of big-time benefits, including $0 down payment, no mortgage insurance, flexible and forgiving credit guidelines and the industry's lowest average fixed interest rates.”

The Benefits of VA Home Loans

These loans are designed to make buying a home more achievable for those who have served. And, by extension, they also give their families the opportunity to plant roots and build equity in a home of their own. Here are some of the biggest advantages for this type of loan according to the Department of Veterans Affairs:

Options for No Down Payment: One of the biggest perks is that many Veterans can buy a home with no down payment at all.

Limited Closing Costs: With VA loans, there are limits on the types of closing costs Veterans have to pay. This helps keep more money in your pocket when you’re finalizing your purchase.

No Private Mortgage Insurance (PMI): Unlike many other loan types, VA loans don’t require PMI, even with lower down payments. This means lower monthly payments, which can add up to big savings over time.

If you want to learn more, your best resource for all the options and advantages of VA loans is your team of expert real estate professionals, including a local agent and a trusted lender.

Bottom Line

VA home loans offer life-changing assistance, and a trusted lender and agent can help make sure you understand the details and are ready to move forward with a solid plan.

You Could Use Some of Your Equity To Give Your Children the Gift of Home

If you’re a homeowner, chances are you’ve built up a lot of wealth – just by living in your house and watching its value grow over time. And that equity? It’s something that could help change your child’s life.

Since affordability is still a challenge, a lot of first-time buyers are struggling to buy a home in today’s market. Even if they have a stable job and a solid plan, buying can still feel out of reach. But that’s where your equity could make all the difference.

To give you an idea, the average homeowner with a mortgage has $311,000 worth of equity, according to Cotality (formerly CoreLogic). That’s significant. And some parents are using a portion of their equity to help their children become homeowners, too.

According to Bank of America, 49% of buyers between 18 and 26 got money from their parents to use toward their down payment (see chart below): 

Even though the data doesn’t specify how many parents used their equity, the wealth they’ve built through homeownership may have helped make it possible – especially given how much equity the average homeowner has today.

While what’s right for each person’s specific situation will vary on a case-by-case basis, that’s a powerful legacy to pass on. It helps those younger people buy a home, build equity of their own, and begin the next chapter of their life with a little less financial stress and a lot more stability. And for those parents? It’s a way to turn what they've built into something deeply meaningful.

This isn’t just about money. For many homeowners, it’s about being the reason their child gets to say, “we got the house.” And giving them the kind of head start they might’ve only dreamed of at their age. And here’s the part that really sticks. Compare the Market says: 

“Of those who did receive monetary aid from parents and grandparents to buy a house, 45% of Americans said they would not have been able to purchase a house without financial support from parents and grandparents.”

Bottom Line

Your equity could be the thing that makes homeownership possible for your children when they might not be able to do it on their own. So, here’s the question.

If helping your kids buy a home was more feasible than you thought, would you want to explore that option?

Why Buyers Are More Likely To Get Concessions Right Now

Especially in areas where inventory is rising, both homebuilders and sellers are sweetening the deal for buyers with things like paid closing costs, mortgage rate buy-downs, and more. In the industry, it’s called a concession or an incentive.

What Are Concessions and Incentives?

When a seller or builder gives you something extra to help with your purchase, that’s called either a concession or an incentive. 

A concession is something a seller gives up or agrees to in order to reach a compromise and close a deal. 

An incentive, on the other hand, is a benefit a builder or seller advertises and offers up front to attract and encourage buyers.

Today, some of the most common ones are:

Help with closing costs

Mortgage rate buy-downs (to temporarily lower your rate)

Discounts or price reductions

Upgrades or appliances

Home warranties

Minor repairs

For buyers, getting any of these things thrown in can be a big deal – especially if you’re working with a tight budget. As the National Association of Realtors (NAR) says: 

“. . . they can help reduce the upfront costs associated with purchasing a home.”

Builders Are Making It Easier To Buy

It’s not just one builder willing to toss in a few extras. A lot of builders are using this tactic lately. As Zonda says:

“Incentives continued to be popular in March, offered by builders on 56% of to-be-built homes and 74% of quick move-in (QMI) homes, which can likely be occupied within 90 days.”

That’s because they don’t want to sit on inventory for too long. They want it to sell. And according to the National Association of Home Builders (NAHB), one of the strategies many builders are using to keep that inventory moving (and not just sitting) is a price adjustment (see graph below): 

Around 30% of builders lowered prices in each of the first four months of the year. While that also means most builders aren’t lowering prices, it also shows some are willing to negotiate with buyers to get a deal done.

This isn’t a sign of trouble in the market, it’s an opportunity for you. The fact that the majority of builders offer incentives and roughly 3 in 10 are lowering prices means if you're looking at a newly built home, your builder will probably try to make it easier for you to close the deal.

Existing Home Sellers Are Offering More, Too

More existing homes (one that someone has lived in before) have been hitting the market, too – which means sellers are facing more competition. That’s why over 44% of sellers of existing homes gave concessions to buyers in March (see graph below):

And, if you look back at pre-pandemic years on this graph, you’ll see 44% is pretty much returning to normal. After years of sellers having all the power, the market is balancing again, which can work in your favor as a buyer.

But remember, concessions don’t always mean a big discount. While more sellers are compromising on price, that’s not always the lever they pull. Sometimes it’s as simple as the seller paying for repairs, leaving appliances behind for you, or helping with your closing costs.

And considering that home values have risen by more than 57% over the course of the past 5 years, small concessions are a great way for sellers to make a house more attractive to buyers while still making a profit.

Bottom Line

Whether you’re looking at a newly built home or something a little older, there’s a good chance you can benefit from concessions or incentives.

If a seller or builder offered you something extra, what would make the biggest difference to help you move forward?

Once your offer is accepted, an inspector will assess the condition of the house, including things like the roof, foundation, plumbing, and more.

That information is incredibly important and paves the way for you to re-negotiate with the seller, as needed. So, you don’t want to skip this step.

Housing Market Forecasts for the Second Half of the Year

From rising home prices to mortgage rate swings, the housing market has left a lot of people wondering what’s next – and whether now is really the right time to move. There is one place you can turn to for answers you want the most. And that’s the experts.

Leading housing experts are starting to release their projections for the rest of the year. These insights will give you clarity – and a little more optimism than you might expect. Business Insider sums up the forecasts (and why they’re good news for you):

“As mortgage rates go down this year, affordability may improve slightly for homebuyers. Inventory is also expected to grow, which should help moderate price growth and make finding a home easier.”

Let’s break it down.

1. Mortgage Rates Should Come Down (Slightly)

While a major drop isn’t on the table, forecasters are calling for a modest decline in rates in the months ahead as the economic outlook becomes more certain. Based on the information we have right now, here’s a look at where they say rates should be by year-end (see graph below):

Even this slight decrease is a welcome change. A seemingly small decline can still help bring down your future mortgage payment and give you a bit more breathing room in your budget.

Just remember, everything from inflation to employment and broader economic shifts will have an impact on where rates go from here. So, don’t try to time the market. And do expect some volatility along the way.

2. Inventory Will Continue To Grow

Inventory has already improved a lot this year. A big portion of the growth the market has already seen is because homeowners are getting tired of sitting on the sidelines. They’ve tried the wait and see approach with rates, and it hasn’t really paid off. And at a certain point, you need to move no matter what the market is doing. This is one reason more homes have been listed lately. And experts say that should continue. As Lance Lambert, Co-founder of ResiClub, says:

“The fact that inventory is rising year-over-year . . . strongly suggests that national active housing inventory for sale is likely to end the year higher.”

If rate forecasts pan out as the experts say, that could be enough to tip some more sellers off the fence and back into the market – giving you even more options for your move.

3. Home Prices Are Moderating

As more homes hit the market, there will also be less upward pressure on home prices. Expert forecasts are still calling for growth, but the pace of that growth is slowing down as inventory climbs. The average of all 7 forecasts shows prices will rise about 2% this year (see graph below):

That means you could finally get a little bit of relief from rapidly rising home prices. When you combine the forecast for healthier price growth with projections for slightly lower mortgage rates, that could mean more buying power in the months ahead.

Keep in mind, though, the housing market is hyper-local. So, this is going to vary by area. Some markets will see prices climbing higher. And some may even see prices dip a little if inventory is up significantly in that location. So, lean on a local agent for insights into what’s happening in your area.

Bottom Line

Why Some Homes Sell Faster Than Others

As you think ahead to your own move, you may have noticed some houses sell within days, while others linger. But why is that? As Redfin says:

“. . . today’s housing market has been topsy-turvy since the pandemic. Low inventory (though rising) and high prices have created a strange mix: Some homes are flying off the market, while others sit for weeks.”

That may leave you wondering what you should expect when you sell. Let’s break it down and give you some actionable tips on how to make sure your house is one that sells quickly.

Homes Are Still Selling Faster Than Pre-Pandemic

The first thing you should know is that, in most markets, things have slowed down a little bit. While you may remember how quickly homes sold a few years ago, that’s not what you should expect today.

Now that inventory has grown, according to Realtor.com, homes are taking a bit longer to sell in today’s market (see graph below):

But before you get hung up on the ten-day difference compared to the past few years, Realtor.com will help put this into perspective:

“In April, the typical home spent 50 days on the market . . . This marks the 13th straight month of homes taking longer to sell on a year-over-year basis. Still, homes are moving more quickly than they did before the pandemic . . .”

By this comparison, if your house does take a little more time to sell this year, it’s not really a concern. It’s actually still faster than the norm. Plus, it gives you a bit more time to find your next home, which is welcome relief when you’re trying to move, too.

Just remember, some homes sell in less time than this. Some take even longer. So, what’s the real difference? Why do some homes attract eager buyers almost instantly, while others sit and struggle?

It comes down to having the right agent and strategy. Here are a few tips you need to know. 

1. Price It Right

One of the biggest reasons homes sit on the market is overpricing. Many sellers want to shoot for a higher price, thinking they can lower it later – but that backfires by turning buyers away.

What to do: Work with an agent to make sure your house is priced right. They’ll analyze recent comparable sales (what other homes have sold for recently in your area), so you know you're pricing appropriately for today’s market and what buyers are willing to pay. As Chen Zhao, Economic Research Lead at Redfin, explains:

“My advice to sellers is to price your home fairly for the shifting market; you may need to price lower than your initial instinct to sell quickly and avoid giving concessions."

2. Focus on the First Impression

A messy yard or a house that needs paint? It’ll turn buyers off. Since buyers decide within seconds whether they like a home, a good first impression is key.

What to do: Outside, clean up your front yard, tidy up your landscaping, power wash walkways, and add fresh mulch. Inside, declutter and depersonalize. And consider minor touch-ups like repainting in a neutral tone. Your agent will offer advice on what to tackle.

3. Strong Marketing & High-Quality Listing Photos

If your listing or your photos don’t look professional, you could have trouble drawing in buyers who think you’re trying to cut corners.

What to do: Instead, lean on your agent’s skills, expertise, and resources. They’ll help you make sure you have:

High-resolution listing photos showing the home in its best light.

Detailed descriptions that highlight differentiating features of your house.

Your listing on multiple platforms, including major real estate sites and social media.

4. The Location of the Home

You may have heard the phrase “location, location, location” when it comes to real estate. And there’s definitely some truth to that. Homes in highly sought-after neighborhoods tend to sell faster.

What to do: While you can’t change where your house is located, your agent can highlight the best features of your neighborhood or community in your listing. By showcasing what’s great about your area, they can help draw buyers into what life would look like in your house.

Bottom Line

Homes that sell quickly don’t necessarily have better features – they have better agents and a better strategy.