Rent vs. Buy index lopsided in California

Rent vs. Buy index lopsided in California

The rate at which home values are increasing across the nation has slowed significantly over the past year and many experts anticipate this trend will continue for the foreseeable future. Over the past year as potential homebuyers found prices beyond affordable levels, demand declined, resulting in the ensuing drop in values. According to the latest national BH&J Buy vs. Rent Index, the demand for homeownership has definitely weakened.

According to the index, residents in 19 out of 23 major metropolitan markets in the U.S. prefer renting and reinvesting in stocks and bonds over entering the housing market in the current climate. This includes California hot spots like Los Angeles, San Francisco and San Diego.

“The trend towards lower BH&J scores is a good sign that the nation’s housing markets are pulling back from the edge of potential disaster,” said Eli Beracha, co-creator of the index.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 3.625 percent and 15-year rates are near 3.125 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.