Now that we are just recovering from the economic crunch, we have seen the mortgage rates hit an all-time low. At one point the mortgages rates were so high many people preferred to rent a house other than to buy one. Nonetheless, it is evident that the rates have now come down and the question lingers, should you buy or rent a house?

Well, the answer to this question cannot be fully exhausted if you do not look at it from different angles and scenarios. For instance, are you planning to stay at your current location for a long time? Well, if you have reached your retirement age and you are looking for a house where you will feel comfortable and relaxed, buying a house is a great option. However, if you know that you are just going to live in your current locality for a certain period of time, let’s say five years and you move on, then you need to consider renting. The reason behind this is that you might find it a burden to keep on paying the rates yet it might even become costly when you decide to sell the house.

You also need to be sure that you can afford the upkeep. The upkeep factor refers to a multitude of issues. As you are buying the house you might only consider the only payment that you need to make to be mortgage rates, yet as you pay the rates, then you will realize that this is not all. There are other bills that come with the maintenance of the house such as lawn care, pest control and more.

It is also possible to find that at times renting is a cheaper option compared to buying the house. You need to be careful and do your math. Some people put up with the stress of buying a house for the prestige of it, yet you can live comfortably on a rented apartment.

In the better part of the decade we have seen continuous decline in mortgage rates and one may ask why? Well, the answer to this is not conclusive unless you look at it from all points of view. Let us start with the supply side. Well, you have to realize that the housing industry is currently experiencing a lot of surplus when it comes to houses. It is evident that during the better part of the economic crunch, many people were unable to keep their houses and hence there were high rates of foreclosures. More so, it is also clear that the demand for houses is also low for many people lost their jobs and hence they are not able to buy houses.

Moreover, you cannot also do away with the psychology bit of it where people know that house prices are low and are waiting the prices to get even lower so that they can buy the houses at a cheaper rate. All this factors have contributed to the low mortgage rates and the only chance that the rates will start to hike is when the demand goes up. It is true that in the very near future, people looking to own houses will realize that the prices are not getting any lower and hence they will start buying the houses. This is the only way that the rates will again normalize.

Guest Author

Fay Sanderson is a guest author for Franklin Debt Relief