Homeownership Provides an Alternative to Rising Rents



Rental increases reached a dramatic level in 2021. According to ApartmentList.com (click for article), “Over the course of calendar year 2021, the national median rent increased by a staggering 17.8%. To put that in context, annual rent growth averaged just 2.3% in the pre-pandemic years from 2017-2019.” 

Middle TN's local markets recorded Nashville up 21.3%, Franklin 26.4% and Spring Hill 28% over this past 12-month period. That's stunning!

Realtor.com projects prices for vacant units will grow 7.1% in the next 12 months. If you’re a renter facing rising rental costs, you might wonder what alternatives you have. If so, consider homeownership. One of the many benefits of homeownership is it provides a stable monthly cost you can lock in for the duration of your loan.

As Lawrence Yun, Chief Economist at the National Association of Realtors (NAR), says, “...fast-rising rents and increasing consumer prices, may have some prospective buyers seeking the protection of a fixed, consistent mortgage payment.”

If you’re planning to make a move this year, locking in your monthly housing costs for 15-30 years can be a major benefit. You’ll avoid wondering if you’ll need to adjust your budget to account for annual increases. Homeowners also enjoy the added benefit of home equity, which has grown substantially right now. In fact, the latest Homeowner Equity Insight report from CoreLogic shows the average homeowner gained $56,700 in equity over the last 12 months. As a renter, your rent payment only covers the cost of your dwelling. When you pay your mortgage, you grow your wealth through the forced savings that is your home equity.


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