Report names Conn. cities better for buying homes than renting
Whether you're looking to call the Nutmeg State your new home or you're planning to swap one Connecticut zip code for another, chances are you are facing a list of questions as dense as the housing market itself. From home style to budget to location, there's a lot to consider when hunting for your dream Connecticut property — but a new report by HomeArea.com is helping to simplify the process.
Using the U.S. Census Bureau's latest estimates from the American Community Survey for all Connecticut cities with a population exceeding 60,000, HomeArea.com estimated these locales' price to rent ratio, or the median home value divided by the median annual rent. House hunters can then use this information to better understand whether it is better to rent or buy in a particular Connecticut city or town.
While HomeArea.com says that any price to rent ratio under 15 is more suitable for buying a home and ratios above 20 are better for renting, Connecticut's overall price to rent ratio has fallen 2.1 percent, down to 23.6 from 24.1. This makes the state as a whole a better climate for renting than buying.
How did individual cities fare? New Britain saw the biggest increase in price to rent ratio at 7.1 percent, making it the second-best city in the state for purchasing a home instead of renting. Norwalk, however, had the largest percentage decrease at 5.6 percent, making it second to last on the list.
Click through the slideshow above to see which locales made HomeArea.com's list of best Conn. cities that are better to buy in than to rent.
But when deciding whether to rent or buy, licensed real estate salesperson for Houlihan Lawrence's New Canaan Brokerage Office Libby Mattson says there are a few factors that may tip the scales toward home ownership instead of renting.
"With mortgage rates going up, that would be a very strong factor to lock in a lower rate before they go up," Mattson said on home ownership. "Rental prices are much higher, and therefore, your monthly payment would be much lower with a mortgage payment."
Another pro of home ownership?
"There's building your personal wealth that comes with owning real estate," something she said works in union with property choice and mortgage rates. Additionally, Mattson offered that home owners don't have to face the potential of the property they're renting being put up for sale by the owner, forcing them to potentially relocate as quickly as they settled in.
While some areas in Connecticut seem ripe for renting, Mattson warned to be wary of some of the perceived conveniences that come with such temporary ties.
"With renting, you don't have deal with the maintenance, but you have to call the landlord to fix things all the time," she said. "But there are hidden move out fees, and you can get clobbered with your security deposit getting held up, so there's risk involved for the renter."
With renting and buying each coming with their own set of pros and cons, one thing is for sure: Connecticut is full of great places to call home.