Why You Should Buy a House in Boston Now
Most of Boston‘s editorial staffers are renters, so we’re well aware of the absurdity of this city’s rental market: Crazy high prices for mostly lousy apartments. When I moved last year, for example, I looked at a bunch of total dumps in Cambridge/Somerville/Jamaica Plain/Roslindale that were asking for nearly $2,000 a month. I may have chosen to live in those places in college—when I was totally content to find a couch on the street corner and bring it up into my apartment—but not anymore. Yesterday, real-estate website Trulia released an interesting report comparing monthly costs of renting versus owning, highlighting the craziness of Boston’s market. In Boston, Trulia calculated, the average monthly rent (which includes security deposits and insurance) is $2,256. Buying a home (including closing costs, maintenance, insurance, and property taxes), meanwhile, only costs $1,338. It’s nearly 41 percent cheaper to buy in Boston than to rent. (Looking at the data made me kind of want to move to Detroit, where you monthly home ownership costs are only $349—but then again, it’s Detroit.)
Granted, Trulia failed to include the cost of the down payment in their calculations. As they pointed out, “The big obstacle holding back renters who want to buy is the down payment—even more than getting a mortgage. And keep in mind, in the metros where the cost of buying is less than half of what it would cost to rent over the long term, it still takes years to save enough for a down payment.”
Just how long, you ask? Last month, Trulia calculated that the average Boston worker would need to save 10 percent of their paycheck for 12.1 years in order to afford a 20 percent down payment. So, start dropping money into your piggy-bank: In just a dozen years, you can really start saving some money on rent.