Jorge Chiriboga

Chiriboga Realty LLC
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Is It Better to Buy or To Rent in Houston, TX?

March 21st, 2018

I was examining the latest Real Estate market report just published this month, and verified that the "median" rental price in the Houston market, for February 2018, was $1,720 per month.

The median rental price is a more accurate representation than the average price as it shows where the middle point in the market is as opposed to the average that can be skewed by a large number of high end homes.

Next, I looked at the Houston market map and verified that you can find rental homes at this price in several areas of town. But I was mostly concerned where were the highest number of rentals at that price. The rental sales history for the last 6 months in the Houston area showed that the Cinco Ranch market had the largest number of rentals around $1720 per month.

Now, a monthly house payment of $1720 would represent a purchase price of $200,000 in the Houston market when we add the principal, interest, taxes, and insurance (PITI) altogether.

So, I did a search in the same area above (Cinco Ranch) to find out what homes are available for sale under $200,000 and I found several homes under $200,000 today. One of those homes is the following: 20019 Roycroft Lane, Katy, TX 77407. As you can tell, this is a very nice home. It is not a listing I have for sale so I am not promoting it. I am just showing you what you can own instead of renting.

The above home was built in 2010, 3 bedrooms, 2 bath, 1462 sf, and it has been on the market for 110 days so you can definitely even negotiate the price down at this point.

You can find all the homes for sale in the Cinco Ranch area under $200,000 by clicking here.

Isn't better to pay yourself as opposed to paying someone else's mortgage?

Now, is it still a good time to buy from the financing side? Take a look at the picture below, and check what Freddie Mac's predictions are for the 2018 interest rates:

As of today, our interest rates are around 4.5% for an FHA loan with a 30 year fixed-rate.

What impact would this have in your monthly payment by having to wait?

So, at least, it is not worth it to wait until 2019 when we expect the interest rates to go even higher.

Finally, it would be worth noticing that if you have been renting for a while, this is what you have paid to your Landlord so far:

As you can tell, even if you have been paying $1000 per month for 5 years, you have already paid $60,000, and none of that money goes with you when you move out. Not even your entire deposit probably.

Therefore, in Houston, it pays to own a house.

If you have any questions, please call me at 832-462-7909.

Jorge Chiriboga, ​is a Senior Realtor with the Chiriboga Realty LLC team. He ​entered Real Estate in 2006, and holds the prestigious Certified Residential Specialist (CRS) designation. Only 3% of all Realtors in the US are awarded this designation. ​Twelve years later, his six-person team's sales volume totaled $57 million, driven by expertise in negotiations, customer service and knowledge of the Houston Real Estate market.

Disclaimer : The views and opinions expressed in this blog are those of the author and do not necessarily reflect the official policy or position of the Houston Association of REALTORS®

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Chiriboga Realty LLC
5555 W Loop South, Ste 420-C, Bellaire, TX 77401   Get Directions
Phone: (713) 589-3234
Fax: (281) 761-6553
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