{"id":395580,"date":"2020-12-08T10:19:59","date_gmt":"2020-12-08T15:19:59","guid":{"rendered":"http:\/\/www.marketnewsdesk.com\/?p=395580"},"modified":"2020-12-08T10:19:59","modified_gmt":"2020-12-08T15:19:59","slug":"index-even-in-a-pandemic-demand-for-homes-remains-robust","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/index-even-in-a-pandemic-demand-for-homes-remains-robust\/","title":{"rendered":"Index: Even in a Pandemic, Demand for Homes Remains Robust"},"content":{"rendered":"

\n‘For Every Negative, There\u2019s a Positive to Help Balance the Housing Market’
\n<\/h2>\n
\n

BOCA RATON Fla., Dec. 08, 2020 (GLOBE NEWSWIRE) — The coronavirus crisis has led to a surge in joblessness and economic uncertainty, but interest in homeownership across the country remains as strong as it was before the pandemic, according to the latest national index by professors at Florida Atlantic and Florida International universities.<\/p>\n

The Beracha, Hardin & Johnson Buy vs. Rent Index<\/a> determines whether consumers will create wealth faster in buying a home and building equity or renting the same property and reinvesting the money they would otherwise have spent on ownership, such as a down payment, taxes, insurance and maintenance. The index also reveals the degree of upward or downward pressure on the demand for homes.<\/p>\n

The professors examine the entire U.S. housing market but focus on 23 key metropolitan areas, factoring in home prices, rents, mortgage rates, investment returns, property taxes, insurance and home maintenance costs.<\/p>\n

Third quarter figures show that, on average, it\u2019s better to own and build equity in the metro areas of Chicago, Cincinnati, Cleveland, Detroit, Honolulu and New York because the cost of renting is outpacing the cost of owning.<\/p>\n

But renting and reinvesting is the more attractive option in Atlanta, Boston, Dallas, Denver, Houston, Kansas City, Los Angeles, Miami, Milwaukee, Minneapolis, Philadelphia, Pittsburgh, Portland, San Diego, San Francisco, Seattle and St. Louis. In those areas, home prices are accelerating faster than rents.<\/p>\n

\u201cMarkets that favored renting and reinvesting before the pandemic still favor renting now, and the same is true with markets where buying is the better option,\u201d said Ken H. Johnson<\/a>, Ph.D., a real estate economist and professor within FAU\u2019s College of Business<\/a>.<\/p>\n

\u201cGiven all the craziness of a pandemic, increasing spread, high unemployment and other factors, the demand for homes has not changed because mortgage rates remain so low and many young professionals aren\u2019t afraid of the virus. For every negative, there\u2019s a positive to help balance the housing market. No one could have predicted this.\u201d<\/p>\n

Still, buyers and sellers shouldn\u2019t count on home values steadily increasing, the professors said. They expect 15- and 30-year mortgage rates to rise moderately in the coming year, and that would slow price growth.<\/p>\n

\u201cPotential buyers would be looking at higher down payments and higher monthly payments relative to eight months ago, when prices were noticeably lower,\u201d said Eli Beracha<\/a>, Ph.D., associate professor in the Hollo School of Real Estate at FIU<\/a>.<\/p>\n

The best possibility for the U.S. housing market is sustained low mortgage rates and the successful rollout of COVID-19 vaccines, said William Hardin<\/a>, Ph.D., a professor in FIU\u2019s Hollo School.<\/p>\n

\u201cThis should maintain demand for ownership at levels sufficient to maintain current prices,\u201d Hardin said.\u00a0<\/p>\n

Homeownership traditionally was considered the far better option than renting and reinvesting for building wealth, but the historic housing crash from 2006-2011 changed that perception for many Americans. The BH&J Buy vs. Rent Index, first published in 2013, shows that even when home prices are rising, renting and reinvesting can be equally or more lucrative for disciplined investors.<\/p>\n

Still, renters who would not invest the money they would otherwise have spent on ownership are better off buying a home because it is a self-imposed savings plan, the professors said.<\/p>\n


\n
\n \n <\/div>\n

\n
Paul Owers\r\nFlorida Atlantic University College of Business\r\n5612214090\r\npowers@fau.edu\r\n<\/pre>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"
‘For Every Negative, There\u2019s a Positive to Help Balance the Housing Market’ BOCA RATON Fla., Dec. 08, 2020 (GLOBE NEWSWIRE) — The coronavirus crisis has led to a surge in joblessness and economic uncertainty, but interest in homeownership across the country remains as strong as it was before the pandemic, according to the latest national index by professors at Florida Atlantic and Florida International universities. The Beracha, Hardin & Johnson Buy vs. Rent Index determines whether consumers will create wealth faster in buying a home and building equity or renting the same property and reinvesting the money they would otherwise have spent on ownership, such as a down payment, taxes, insurance and maintenance. The index also reveals the degree of … <\/p>\n
Continue reading “Index: Even in a Pandemic, Demand for Homes Remains Robust”<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-395580","post","type-post","status-publish","format-standard","hentry"],"yoast_head":"\nIndex: Even in a Pandemic, Demand for Homes Remains Robust - Market Newsdesk<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.marketnewsdesk.com\/index.php\/index-even-in-a-pandemic-demand-for-homes-remains-robust\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Index: Even in a Pandemic, Demand for Homes Remains Robust - Market Newsdesk\" \/>\n<meta property=\"og:description\" content=\"‘For Every Negative, There\u2019s a Positive to Help Balance the Housing Market’ BOCA RATON Fla., Dec. 08, 2020 (GLOBE NEWSWIRE) — The coronavirus crisis has led to a surge in joblessness and economic uncertainty, but interest in homeownership across the country remains as strong as it was before the pandemic, according to the latest national index by professors at Florida Atlantic and Florida International universities. 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