Renting vs. Buying a Home in Richmond
Richmond, VA is not only the capital of Virginia but is also a desirable place to make home. Richmond home buyers will find this area to be rich in history with a plethora of museums as well as several battlefields of the American Civil War. If you are planning to relocate in Richmond, you should decide whether buying real estate in Richmond makes more sense than renting. Although each homebuyer's personal circumstances may differ, there are some common factors that every home buyer should consider when making the decision to rent or buy, including:
- Qualifying for a mortgage – before you can decide if buying a home in Richmond is right for you, you need to determine if you qualify for the financing that will likely be needed to purchase a home. For a conventional mortgage, you will likely need a credit score in the mid to upper 700s and as much as 20 percent down. For government backed financing, such as an FHA loan, you will typically need a credit score over 650 and a down payment of 3.5 percent or more. You will also need to a show a stable employment history for either type of financing.
- Maintenance – Richmond home buyers must be ready to commit to more than just a monthly mortgage payment. Buying a home means that you will also be responsible for maintenance and upkeep of the home. If the air conditioning system goes on the blink in the middle of August there is no calling a landlord – you must find a repairman and pay for the repairs yourself.
- Freedom to make changes – as a renter, you will likely have to accept the property as is, meaning that you cannot do much to make it yours other than decorate with your furniture and some artwork. On the other hand, buying real estate in Richmond allows you to make the home your own by painting, remodeling, or even adding on to the existing structure.
- Stability of current employment –buying and selling a home can be a time consuming and costly process. If you are not certain that you will be in Richmond for at least three years because of your job or any other reason, you may wish to rent instead of buy.
If you decide that buying real estate in Richmond is your choice but you are concerned about financing and/or being able to afford a home, there are some steps you can take to help ensure that you are able to buy your dream home.
First, look into an FHA loan or other government backed loan. Qualification criteria are typically a bit more lenient than conventional loans. In addition, your down payment will be less. If you are still unable to come up with the down payment, check into programs such as the Virginia Department of Housing and Community Development, which helps first time buyers with down payment assistance.
Also, Richmond home buyers who are on a budget should consider buying a “starter home.” This will likely not be the home you grow old in; however, it allows you to enjoy the benefits of home ownership while building equity that can eventually be used toward your dream home purchase.