With a thriving cultural scene, record-breaking real estate market and all-time high employment rates, Houston — No. 1 spot on Forbes’ latest list of America’s Fastest-Growing Cities — is an all American economic powerhouse.
As more people make the move to the Bayou City, deciding to rent or buy can be a challenge. The sprawling, 627-square mile city offers so many regions and properties to choose from. A Texas Monthly notes, “A quick jaunt to visit your friend who lives across town in Houston is the equivalent, for our East Coast friends, of dropping in on their pals who live in Paterson, New Jersey from Rockaway Park.”
When you’re moving, you often have limited time to decide where to live. Weighing the pros and cons of renting vs. buying can save you the time and headache that often accompanies home buying.
Why rent in Houston?
The U.S. Census Bureau reports that only 35 percent of millennials own property. In today’s tight real estate market, young people are opting to rent for a number of reasons.
1. Experience the culture before diving right in.
“For a variety of reasons, many people who move to Houston choose to lease a property, at least initially,” notes Krista Kubala, real estate agent at Bernstein Realty Inc. “Renting affords newcomers the opportunity to get to know a city before taking the plunge into homeownership in an unfamiliar community.”
This is especially true for those who move to Houston and want to get a feel for the city. They can plant their roots at their own pace.
So go enjoy Houston’s 19 museums, its up-and-coming reputation as a culinary mecca or its booming metro area, which just helped Houston become the most diverse city in the U.S.
2. More flexibility, less maintenance.
With no long-term commitment, renting allows for plenty of flexibility and gives homeowners the ability to stay mobile in the event of a relocation.
“Whether it’s time for a larger place or you’re transferring for work, it takes a lot of stress out of the equation knowing you won’t have to find a buyer for your home or condo,” says Diana Pittro, executive vice president of RMK Management Corp. “You also won’t have to worry about whether you’ll lose money on the sale.”
Keep in mind that homeowners mow lawns, clean pools and make (and pay for) all major repairs around the house – when you rent, your landlord is the hookup for general property upkeep.
3. Zero ownership costs.
The National Association of Realtors’ fourth-quarter data reports that a median home price in Houston goes for $199,300. For young newcomers, that’s one big chunk of change and a very serious commitment.
For this reason, there are some people who rent purely due to financial circumstances. The move-in process requires a simple application and minimal upfront costs, meaning you don’t have to worry about ownership, assessments and hefty 20 percent down payments.
Benefits of Buying in Houston
Although renting offers convenience and flexibility, the high demand for rentals continues to up their costs. For potential homeowners, buying may have its benefits after all.
1. Nationally, homeownership remains cheaper than renting.
According to Forbes, homeownership remains cheaper than renting nationwide and in all 100 of the largest metros. This is true for two reasons:
- In the past year, the 30-year fixed mortgage rate has fallen from 4.8 percent to 4.3 percent.
- Rents have risen faster than prices, excluding foreclosures.
Together, these trends have made buying even more affordable versus renting in comparison to last year.
2. Paychecks stretch farther in Houston than any other metro.
Living well isn’t just about your income, it’s about how much everything costs – and truthfully, you can’t beat Houston in this category.
The ratio of the median home price to median annual household income in Houston is 2.9, which is remarkably low for such a dynamic urban region. In San Francisco, a house goes for 6.7 times the median local household income.
Including the cost of living, Houston also has the highest median pay in the country at $73,418, according to Business Insider. Suddenly, high pay and low costs put a different perspective on home buying.
3. Emotional Satisfaction.
Here’s one of the biggest benefits of homeownership: You can enjoy a home that’s purely yours.
“You can paint the walls, stain the hardwoods and replace the shower heads without needing to ask your landlord’s permission,” notes Paula Pant of Huffington Post. “You can upgrade the appliances, remove partition walls and hang new light fixtures. In short, you can stamp the house with your personality.”
Torn between buying and renting? According to the U.S. Bureau of Labor Statistics, Houston is the number one city for job creation in the U.S – not to mention home to 26 Fortune 500 companies. Regardless of the living choice you make, you’re moving to the right place indeed at the right time.
Relocating to Houston?
Are you making the move to Houston? Are you a resident with some insiders to share? Add your thoughts to the Comments section below.