Southern California rents increasing
Now may be the perfect time to buy one of the homes for sale in Orange County, as the cost of renting in the county and in Los Angeles is on the rise. According to The Orange County Register, renting costs in Southern California jumped 2 percent in June 2012 compared to the year before. The Consumer Price Index revealed this is the biggest percentage increase since June 2009.
According to the United States Census Bureau, the ownership rate in Orange County from 2006 to 2010 was 60.8 percent - leaving just under 40 percent of the county residents renting. This is approximately three percent lower than the number of renters in California during the same period. The fact that the median value of owner-occupied housing units during this time in Orange County ($607,900) is above the state median ($458,500) shows that, despite the higher price tag, the majority of residents in the area would rather buy than rent a home.
When deciding whether buying or renting in Orange County is best for you, consider which option will pay off financially in the long run. While buying may seem like a financial burden that can be circumnavigated by renting, recent data has found that costs associated with buying pay off or "break-even" in Southern California, typically within a few years.
The Los Angeles Times reports that a real estate trends research company has provided data that reveals buying pays off after just three years on average nationwide. In the combined Los Angeles and Orange counties, it takes an average of 4.3 years. This is assuming the buyer has made a 20 percent down payment. Keep in mind though that the break-even point may take longer or shorter depending on the city.
Rents have been creeping up on an annual basis for the past 22 consecutive months. The OC Register states rents have been increasing 3.3 percent since rent inflation returned in August 2010. Furthermore, the average rent in Orange County and Los Angeles has increased 9.9 percent in the last five years and a whopping 47 percent in the past 10 years.
Consider discussing the benefits of buying a home in Orange County with a local real estate agent today. These days, buying may be a much smarter option for many OC residents.