Renting vs. Buying: Is Renting The Smart Choice in Today’s Market?

While homeownership has long been considered the gold standard, renting an apartment provides a flexible and affordable living solution. In today’s market, with increasing housing costs and fluctuating interest rates, renting offers a compelling choice for many.

Market Considerations

Rising home prices and interest rates make purchasing a single-family home increasingly challenging, making multifamily housing an attractive option. Renting multifamily units offers flexibility, allowing individuals to avoid the long-term commitment of homeownership. Additionally, the uncertainty surrounding the housing market can make renting a more financially stable choice. By renting, individuals can enjoy the benefits of a more affordable and flexible living arrangement.

Rising Home Prices and Mortgage Rates

Rising home prices and mortgage rates have significantly impacted the housing market in recent years. As demand for housing has outpaced supply, home prices have soared, making it difficult for many potential buyers to enter the market. The Federal Reserve has also raised interest rates to combat inflation, leading to higher mortgage rates. This combination of rising prices and higher borrowing costs has made homeownership more expensive and less accessible for many individuals and families. Beyond the monthly mortgage payment, homeownership comes with additional expenses that can impact the overall budget. Property taxes, which vary widely by location, can be a substantial burden. Furthermore, maintaining a home requires ongoing upkeep, including repairs, landscaping, and utility bills. These costs can add up quickly, making it crucial to factor them into financial planning when considering homeownership.

Multifamily Occupancy Rates Remain High

Multifamily occupancy rates remain high according to Fannie Mae. Data from RealPage echoes this trend, showing that occupancy rates across the United States remained steady in the third quarter of 2024. The national average occupancy rate in 2024 climbed to 94%, up from the previous year. The Southwest and Midwest regions saw particularly strong increases, with occupancy rates reaching 96% and continuing to grow. This high occupancy demonstrates the ongoing demand for multifamily housing and presents potential investment opportunities.

Roers Companies understands the growing demand for affordable housing options. Our expertly managed properties offer exceptional value and amenities, attracting a strong resident base. By investing with Roers, you contribute to providing quality, affordable housing while enjoying the benefits of rising occupancy rates driven by the affordability gap between homeownership and renting. To learn more about investing multifamily real estate with Roers Companies and explore the potential to expand and diversify your portfolio, please reach out to your investor relations professional or contact the investor relations team here.

Date Published 12/30/2024

Sources: Frannie Mae, RealPage, Freddie Mac

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