Is Renting a Home in the Current Economy a Terrible Idea

In this episode of the Money Pig Podcast by Goodwin Investment Advisory, the team discussed the current housing market conditions, highlighting the high 7% mortgage interest rates and limited market inventory. Ray Brown, CFP® profession and Wealth Planner at GIA, discussed essential financial factors, emphasizing the necessity of having a substantial down payment and keeping mortgage payments under 25% of gross income.

The conversation also explored the advantages of renting, such as flexibility, avoidance of major repair costs, and fewer maintenance responsibilities, making it beneficial for those with transient lifestyles like military families. Financial considerations included comparisons between rent and mortgage payments, the impact of amortization schedules, and the opportunity costs of owning a home. Contrary views were presented by John Tamney, who argued that housing should be seen as a consumption good rather than an investment, and considered the illiquidity of home investments. The episode concluded with a discussion on the benefits of homeownership while acknowledging current economic challenges for young people, encouraging them to consider renting until they are financially secure.

If you want an expert who can give sound advice and help you navigate how to invest your wealth best and plan for your retirement, reach out to us to schedule a quick call. One of our CFP® professional wealth advisors would love to discuss your individual goals and options with you. The first step in our process is to schedule a free 15-minute intro call with our Goodwin Investment Advisory consultant here.

The Money PIG podcast is hosted by Reid Trego. Goodwin Investment Advisory is a Registered Investment Advisory firm regulated by the Securities and Exchange Commission in accordance and compliance with securities laws and regulations. Goodwin Investment Advisory does not render or offer to render personalized investment or tax advice through the Money PIG podcast. The information provided is for informational purposes only and does not constitute financial, tax, investment or legal advice.
By Published On: June 21st, 2024

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