Buy or rent your first Redding, CA home.
As a licensed Real Estate Broker here in California, I get asked once in a while if a person should rent a home or apartment or buy their first house in Redding CA.
The first thing that comes to mind when asked this question is the length of time the person will I’ve in the home. Are you going to live there a long time or short term? There are pros and cons to both choices. Let’s take a few minutes to discuss the choice between renting a single family home and buying one.
Let us say that for the first example that you are going to live in the home for only a short time maybe a year or two. In order to make money in Real Estate, we must factor in time. Time is where all of the magic happens. If you are only going to be in the Redding area for a year or so, we would encourage you to rent unless you are planning on leaving behind a rental property that you will be selling in the future or returning to at a later date. The reason we share that it is better to rent is due to the lack of time for a home loan to mature. If you were to buy a home and sell it a year later unless the market is super crazy you will not make much. Possibly not enough to cover the cost of buying the home e in the first place with the closing cost and fee associated with buying a home. Now if you are going to turn the home into a rental home or an investment property everything may work out great as then you will be adding the element of time. If you keep it as a rental property for say 10 years it will have surely appreciated in value and you will stand to make some cash. What if you hold it longer? 30 years until the rental has been paid off. Now the rent coming is income minus any experiences. This example is a fantastic idea if you have not bought in the past and are looking to build a Real Estate portfolio. If you aren’t looking for investments, we would say that it is best to rent a house, apartment or a condo for the short term as not to comment funds you may not get back.
Okay, not staying short term you are in for the long haul. Yes, you should buy a single family home if you will be in the area 4 or more years. This is where the time element begins to work. Not only will you be paying down the mortgage after a few years, but the home will surely be increasing in value. This is the reason for an investor investing in single family homes in Redding CA. The tenant’s rent payment is paying down the loan and the home is appreciating in value. This works on apartments, duplexes, condos and single-family dwellings.
The big factor is TIME and market conditions. If the conditions are on the positive side and you can see that a chunk of time will be involved you should buy. Otherwise, a landlord is getting the same benefits as you would.
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