Is It Better To Rent Or Buy in a Hot Real Estate Market Like Denver

The real estate market in Denver is hot and the question can come up, is it better to rent or buy in a hot real estate market? The answer depends on a lot of things and only you can answer it.

First time home buyers

Is It Better To Rent Or Buy in a Hot Real Estate Market Like DenverThe market in Denver can be really difficult right now for both buyers and renters. First time buyers have it tough because the homes normally available to first time home buyers are now higher priced and out of reach or are very hard to find, but they are also getting priced out of the rental market as well. So what can you do?

Weigh your options

In order to make a decision, weigh your options. Would it be better for you to continue to rent for awhile? If not, are you willing to find a property below your expectations that may need work? Sometimes that is a good idea if the ready to move in homes are out of your price range. Also look in up and coming neighborhoods. They may not be ideal… yet. Those that appear to be getting popular will mean your investment will give you the equity you need to move up later.

Be sure to save your pennies

Having a substantial down payment can help you get a home when people with smaller amounts saved find it harder to buy. Having more to put down can help you get that house too. You look like a better potential buyer to a seller entertaining multiple offers and it could give you an edge.

Rental potential properties

Look for a property that could have rental potential. Either through an income suite or later when you decide to move up. An income suite could provide you with the ability to purchase a higher priced home because the income will help with the mortgage.

Your best bet is to talk with a Realtor to help you figure out when the best time to buy for YOU might be.

What’s Going on With the Rental Market?

So what’s going on with the rental market? If you’ve tried to find a home or apartment to rent, you may be finding that it’s hard to find one. Well, when there aren’t as many rental properties to be had, and not as many investment homes on the market, that means less supply and higher rents. It also means that when a rental becomes available, there are plenty of people just waiting to swoop in and take it.

What's Going on With the Rental Market?There’s a really good reason for the rental market being what it is and it has to do with the housing market before and after the bubble burst. Before it was really expensive to buy a home. Not so much with renting. Rents were reasonable and there was more than enough supply. After the bubble burst and housing values fell in a big way and the rent vs. own ease flip flopped. It was easy to find a home to purchase and prices fell. The problem was that many people had bad credit from foreclosures or job losses and couldn’t get a mortgage. They still needed somewhere to live so renting was the solution. That meant demand rose. With that rent prices rose and the rental market changed quickly. Any available rental properties were gobbled right up.

Because credit dried up for many people and companies, apartment construction slowed to a standstill. That meant that adding places to rent to the market stopped as well. People who could buy thought twice about doing so since they saw their friends and neighbors lose their shirts in the bubble burst. Younger people also tend not to buy because renting gives flexibility. The younger working public find that if you lose your job, get transferred, or you change jobs, you’re not tied down to a mortgage or have to sell a home.

So the rental market is still tricky. What you may start finding, though, is that places where the owners market has changed from a buyers to a sellers, the rental market will loosen up. Home ownership is coming back into vogue, so renting may become a bit easier.