Cheaper to Buy than Rent on the Eastside

    The economy is getting stronger and the US labor force is at what many consider full employment. Millennials who have put off home buying are jumping into the housing market, now making up 68 percent of first-time homebuyers. For those who think that the best time to buy has past them by, think again. According to Trulia’ latest rent vs. buy article, as of May 2017, it was 33 percent cheaper to buy than rent nationwide but the Detroit metropolitan area it was 46 percent cheaper to buy than rent.

    Prospective homebuyers working in the larger cities in or near Macomb County might consider investing in Warren real estate or homes for sale in Troy. Numbers wise, it might be wiser to explore the eastside. In May 2017, it was 24 percent cheaper to buy in Warren. After the Federal Reserve interest rate hike in June, the benefit of buying in lieu of renting diminishes to 23 percent. Conversely, in Saint Clair Shores it is 42 percent cheaper to buy than rent.

     

    Town Median Sale Price Median Rent % Cheaper to Buy % Cheaper to Buy if Interest Rates Increase Break Even Point
    St. Claire Shores $130,000 $1,200 42% 41% 12.85%
    Washington Township $310,000 $2,125 28% 27% 8.70%
    Shelby Township $240,000 $1,600 25% 23% 7.90%

     

    Saint Clair Shores

    This quaint suburban town is approximately 8 miles east of Warren and hugs the coast of Lake St. Clair. While the area promises beautiful sunsets and peaceful neighborhoods, it is also a great place to buy a home. Currently, the median sale price of homes is $130,000 and the median rent price is $1,200 per month, Opting to own a starter home in Saint Clair Shores could net close to a $500 per month savings.

     

    Washington Township

    This Macomb County community, just north or Warren and Troy, offers something for practically everyone. There are parks, trails, orchards, and farms in addition to shopping at the Orchard Square Mall or its picturesque downtown. In addition to its charm, Washington Township real estate is 28 percent cheaper to buy than rent.

    In this area, the median sales price is $310,000 and the median rent price is $2,125. Buying in this town will net a homebuyer an $8,000 savings per year. Even if the Federal Reserve chooses to raise interest rate again in September, homebuyers opting in will still reap a $538 monthly savings.

     

    Shelby Township

    Situated equidistance from Warren and Troy is Shelby Township. Aside from the ample leisure opportunities, it is 25 percent cheaper to buy than rent in this town. Homes in Shelby Township have a median sales price of $240,000. Compared to the median rent of $1,600 a homeowners monthly cost would drop to $1,143.00 per month. Interest rates would need to climb close to 5 points before it was cheaper to rent than buy in Shelby Township.

    With savings up to $8,000 per year, it makes sense to invest in the Eastside real estate. Options abound throughout the county. Stay abreast of how much home you can afford with tools like this mortgage rate calculator. Get to know the many great towns and home choices on the Eastside by contacting the experts of the Tom Lipinski Team.

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