Infographic: Is it Better to Rent or Buy?

[Pages:1]Is It Better to Rent or Buy?

Many factors can influence your decision to rent or to buy a home. Consider this information as you decide which is best for you.

Those Who Rent vs. Those Who Own

36%

of U.S. total1

44.4

million renters1

$1,420 Average monthly rent payment3

$38,300 Median annual household income4

28.8%

Percent of income spent on housing5

64%

of U.S. total1

76.7

million owners1

$1,513

Average monthly mortgage payment2

$79,900

Median annual household income4

17.1%

Percent of income spent on housing5

4%

Increase in median

monthly cost of renting, 2017 to 20186

14%

Increase in median

monthly cost of owning, 2017 to 20186

Aspiring to Homeownership

84% of non-owners want to own a home in the future, with nearly 75% considering homeownership part of the American dream.7 Top reasons a non-owner would buy a home7:

29%

Improvement in financial situation

27%

Life events such as getting

married, having a child or retiring

18%

Desire to settle in one location

12%

Better/ more stable employment

situation

8%

Other

The top three concerns renters have about purchasing a home are financial8:

Cost of buying

65%

Costs of maintaining a home

58%

Being financially stable after the purchase

48%

Are You Ready to Buy?

When evaluating whether it's the right time to buy or if renting still makes the most sense for you, carefully consider these questions:

Are you planning to stay in your home at least 5 years?

A home purchase doesn't have to be forever, and there will often be factors outside your control that dictate a move. But most experts agree that if you plan to stay in a home less than 5 years, you may be better off renting.9

Can you boost your credit score before starting the process?

39% of rejected mortgage applications were due to issues with credit history and score.10 Improving your score by identifying errors or paying down debt could make you a more attractive candidate to lenders.

What down payment can you afford?

Putting 20% down on a home can help you lower your payments or avoid private mortgage insurance (PMI), but it is not required. The national median down payment is 13%. For first-time buyers, the number is 7%.11 Don't forget to budget for closing costs, which are typically 2-5% of the purchase price.

Do you have an emergency fund to cover unexpected repairs and home maintenance?

You'll want to budget about 1% of a home's purchase price each year to cover maintenance costs.12 So if your home costs $250,000, you'll want to have $2,500 set aside every year just for repairs.

Do you understand the mortgage application process?

Finding a mortgage lender you trust can help you feel more confident during the home buying process.

Remember: Owning a home is a big commitment. Use your time as a renter to build up a strong savings foundation and maintain or boost your credit score,

so you're in a good position if you decide to take this step.

Ready to discover your buying power? Getting pre-approved* is one of the first steps to take on your home buying journey. Learn more about how you can get started.

1 "Quick Facts: Resident Demographics," October 2018, National Multifamily Housing Council 2 2017 American Community Survey, United States Census Bureau 3 "Apartment Market Report," January 2019, RENTCaf? 4 "Where and Why the Income Gap Among Buyers, Homeowners and Renters is Widening," Jan. 29, 2019, Zillow 5 "Buying a Home is Less Affordable Than It's Been in Almost a Decade," Jun. 20, 2018, Zillow 6 "Rent vs. Buy: Current U.S. Housing Trends," Aug. 30, 2018, 7 "Aspiring Home Buyers Profile," Jan. 14, 2019, National Association of REALTORS? 8 "2018 Home Buyer Report," NerdWallet 9 "If you're thinking about buying a home, first ask yourself this critical question," April 11, 2019, CNBC 10 "Home Buyer Reality Report," Feb. 23, 2017, NerdWallet 11 "How much is a down payment on a house?" Nov. 4, 2018, Bankrate 12 "How Much You Should Budget for Home Maintenance," Jan. 4, 2019, The Balance

*Pre-approval is based on non-verified information and is not a commitment to make you a loan. Loan approval will be subject to, but not limited to, verification of all income, asset and liability information provided by you, satisfactory property appraisal, compliance with loan program guidelines and all required closing conditions such as survey and title examination.

? 2019 SunTrust Banks, Inc.

Equal Housing Lender. SunTrust Bank - NMLS #93471. Mortgage products and services are offered through SunTrust Mortgage, a tradename for SunTrust Bank, and loans are made by SunTrust Bank. All rights reserved.

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