Amid rental spikes, is buying looking better again?
The apartment market has long been a haven for skittish buyers in Greater Boston.
But soaring rents may be poised to shift that calculus, making renting as costly as buying in some cases.
The median rent for a two bedroom in Boston and its suburbs is nearing the $2,000 mark, according to a new survey by Champagne, Illinois-based rental market data cruncher Cazoodle.
That's a 13.3 percent jump this year through September compared to the same period last year.
It's also far above a handful of other cities that Cazoodle ran stats on, with Washington metro, at $1,875, the closest, and Chicago, the Twin Cities and Baltimore well behind these market leaders, so to speak.
So what does this do to the rent-versus-buy calculus?
As readers of this blog know, home prices have been sticky on the way down in the Boston area. Some towns have seen little or no change from the highs hit during the bubble years.
Yet if you can get a rock bottom interest rate - and that's a big if - the rent versus buy comparison becomes a wash.
With an interest rate of 4 percent or just under, you are looking at mortgage payments in the $1,500 range on a $315,000 mortgage. (This is based on a $350,000 house, minus a 10 percent down payment.)
You still have to factor in taxes, which will add another $200 to $300 a month. Moreover, just about any house you buy within the 495 belt that isn't brand new and astronomically priced is going to require some level of updating or outright renovation, so that's another added cost to consider.
That said, renting is no longer the hands down bargain it once was.
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