Home Sweet Rental?

The American Dream used to be described having a spouse, 2.5 kids, a dog and/or cat, and most importantly, owning your own home, complete with white picket fence. As the economy struggles, the American Dream seems to be shifting quite a bit from that ideal. More and more people wait until they’re in their late 20’s or so to get married (if they get married at all), families are smaller, and buying a house has being replaced with living in rentals.

Not more than a few months ago, most economists were telling people with good credit and stable jobs to go buy a home instead of rent.  Interest rates were low, foreclosures were frequent, and because the housing market was kind of cruddy, you could get a mortgage for less per month than you could rent for. And if you look at the market right now, it’s still that way.

But not for long. If you heard the news last month, Standard and Poor reduced the United States’ credit rating because of the increase in the national debt that occurred. Now, by itself, that wouldn’t be a big deal. Throw in a cruddy economy and banks that already had to be bailed out and you get what we’re going to see soon. Interest rates will rise, higher credit ratings will be required in order to even get a mortgage, and at that point, why would you want to? The initial increase in interest rates may not seem like much, but over the 20 to 30 years that most people have a mortgage for? It’s not pretty, friends.

Renting leaves a nasty taste in some people’s mouths, but honestly, it’s becoming the cheaper alternative, and as it becomes more difficult to buy a home, many people opt to rent their homes out until they can be sold, thus creating more of a rental market. That also makes the rental market stay reasonable, keeping monthly payments lower than what you’d be paying when the market was lousy.

If you’re considering renting instead of buying a home, here are a few things to give you a little less stress about the situation.

  1. Don’t settle for second best. Look around for awhile if you can spare the time. You may come across your best option without knowing it.
  2. Always ask about what’s included. Always. I wouldn’t have gotten my current rental at its monthly cost… until I found out that heat was included. That totally sealed the deal.
  3. Read the lease carefully. It’s a contract, something you are legally bound to abide by. Make sure you know what it says inside and out.
  4. Maintain a good relationship with your landlord. This will make your life easier. I never see my landlord, because we have such a good relationship that I established early on and he trusts me greatly. He’s incredibly flexible because of it as well.

Go forth, and live the new American Dream. Find your dream rental, save money, and enjoy your weekend!

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