Owning is the Way to Go for Many in NoHo
An increasing number of Angelenos are opting to call North Hollywood home, as this thriving neighborhood continues to attract interest with its creative vibe, convenient location and diverse array of eateries, shops and entertainment venues. And for many who decide to make the move to North Hollywood, it may actually make more sense to purchase a residence here rather than rent one.
Buying vs. Renting
Though homeownership has been perceived in recent years as out of reach for a large percentage of the U.S population, the reality is that buying a house oftentimes stacks up against renting as the more affordable option – even in urban regions such as Los Angeles. It is actually 24% cheaper to purchase than to rent in Los Angeles right now, according to the most recently published Rent Vs. Buy report from real estate data provider Trulia.
Of course, potential buyers need to take various factors into consideration when calculating the cost difference between buying and renting. For the clearest comparison, it is best to zero in on a specific neighborhood and look at prices and rents of similarly sized residences in that area.
In North Hollywood, monthly mortgage payments for single-family residences at Vineland Metro, a brand new community opened here by MBK Homes, actually pencil out to be less expensive than rents at some of the hottest apartment properties that have been built as of late in the neighborhood.
Current rental rates for three-bedroom, two-bath luxury apartment units in the NoHo Arts District range from upwards of $2,900 per month for approximately 1,200 square feet to more than $4,200 per month for around 1,360 square feet. In contrast, three-bedroom, two-and-a-half-bath homes ranging in size from 1,594 to 1,629 square feet at Vineland Metro (which is adjacent to the NoHo Arts District) are presently selling for between $450,000 and $470,000. Those prices equate out to monthly mortgage payments that range from approximately $2,850 (based on a conforming 30-year fixed-rate with 10% down) to $3,200 (based on an FHA 30-year fixed-rate with 3.5% down).
As the examples above illustrate, becoming a North Hollywood homebuyer instead of a renter may just get you more space for your buck.
Locking in Lower Prices
North Hollywood also offers lower home prices than various other areas in the vicinity. For instance, the neighboring City of Burbank had a median sales price of $551,750 for homes sold from January to April 2014, while North Hollywood had a median sales price of $442,500 for this same time period, according to recent research from Trulia.
And locking in today’s relatively low mortgage rates will ensure you have a manageable monthly payment over the long term. According to newly released April data from Freddie Mac, the 30-year, fixed-rate average has fallen slightly to 4.34%. However, mortgage rates are expected to rise to nearly 6% over the next year, so buying today could save you a bundle. In addition, with a fixed-rate mortgage, your monthly payments will remain stable over time. This is a significant plus over renting, which leaves you at the whim of unforeseen rate increases from year to year.
Considering the Variables While owning offers obvious advantages for many, there are definite questions to weigh before taking the plunge and purchasing a home.
Crucial factors to consider include how long you plan to stay in the home and how much it is expected to appreciate over that time period. North Hollywood is one area where home values are on the rise, with the median sales price of $442,500 reported by Trulia representing an increase of 16.6% or $72,500 compared to the same period one year ago. Looking back over the last five years, sales prices have appreciated 42.7% in North Hollywood, according to Trulia.
Buying makes sense if you have enough money saved to make a decent down payment. A high credit score is also important, as it goes a long way in securing you the best possible mortgage rate.
Reaping the Rewards
For those who are in a good position to purchase, homeownership offers a number of benefits.
When you buy a residence, you not only have the chance to build equity as the house appreciates in value, but you can also take advantage of special tax breaks offered only to homeowners. In addition, there are no monthly community fees involved, which even some apartments have. And purchasing a house often spurs a greater sense of community pride, which can result in lower crime rates and better-maintained properties in areas with higher homeownership.
Another advantage of owning over renting is the opportunity for a more private, personalized space to call home. Buyers at new home communities normally have the option of customizing the interiors of their residence by choosing from a selection of different cabinets, counters, fixtures, paint and flooring. At North Hollywood’s Vineland Metro community, for example, buyers can choose from unique designer selected flooring packages available in an array of color choices. Homes here also offer low maintenance, which is often an added benefit of buying new.
When it comes down to it, buying a home can offer a number of advantages over renting – and is often more economical than what many may think.
For more information on owning your own home in North Hollywood, visit Vineland Metro.
**** For information on Los Angeles theatre, tickets to theatre in North Hollywood’s NoHo Arts District, theatre reviews, the NoHo Event Calendar, restaurants, news and local businesses in NoHo, or anything and everything about the NoHo Arts Community, bookmark nohoartsdistrict.com.