The decision to rent or buy a home in California can be a difficult choice, depending on many factors. It’s important to research how much it’ll cost you to rent based on your income. You’ll need to be able to afford a down payment and deposit. You’ll also want to evaluate your lifestyle and ensure you’re ready to commit to relocating permanently to California.
Buying a Property in California
The average cost for a home in California is $ 548,000. This amount is twice the national average of $226,000. The cost of housing in California increased by as much as 2.2% this past year. It’s continued to continue increasing throughout 2021.
These figures probably do not surprise you, given the expensive cost of living in the state, as well as too high prices in the real estate market overall. Although the COVID-19 pandemic is having a strong impact and there is talk of rising inflation, house prices will not fall.
Things to Consider When Planning to Buy a Home
- Market forecasts
- Personal income and monthly expenses
- Long-term financial goals
- Future plans
The advantage of owning your own property is that you invest in something of your own every month, instead of paying rent on something you’ll never get the opportunity to own. There are trade-offs when owning your own home, like being responsible for making your own repairs, but in the long run, buying your own home is a better investment. Property is a reliable asset to possess.
Renting a Property in California
Monthly rent in California can be as high as $2,600 a month. This of course depends on what city you’re living in, which neighborhood with that city, the size of the property, and the number of amenities provided. The average rent in the United States is around $1,500 a month, significantly cheaper than California.
Considering the current global circumstances, rent is relatively affordable, especially in the last year and a half, making it an attractive option at the moment. You won’t be living in the apartment permanently, but you’ll owe less money each month for housing. This option is better if you’re unsure where you’ll be living for the long term.
Advantages of Renting
- As a tenant, you won’t be responsible for maintenance, repairs, or property taxes
- You can easily switch apartments if the building is not a good fit for you
- It’s significantly cheaper to rent than buy in the short term
So…Rent or Buy?
The final answer is that it all comes down to your financial capabilities and future plans. Usually, most people move to California to rent at first and they are content with their lifestyle and have the financial means, they’ll settle down in a more permanent home.
Answer the question: how long do you plan to be here? If you are considering being in California for a few months or a year, then renting is the better option. If you’re looking at being in California for the long-term, buying could be the better choice for you.
Whatever you choose, it is best to look for a reliable partner: a real estate broker or an owner who will sell or rent directly. This will save you time. Agents also negotiate discounts, which is worth the commission you will have to pay them.
Finally, compare rental property prices and sale prices, look ahead and see which is worth more. Even the biggest financier cannot give a definite answer, because everything depends on the individual characteristics of the clients and the changing financial market. Accept it as a future investment and build your own business plan!
