While there are many factors to consider when deciding to buy or rent, according to Trulia buying remains cheaper in all of the 100 largest metro areas, including Chicago, where you can save as much as 47% on a median priced home compared to the cost of renting.
Beyond the numbers there is a lot to think about when deciding whether to buy or rent, such as:
- How long do you plan on living in the home? Because purchasing a home involves upfront costs such as the down payment as well as closing costs you generally want to stay in the home for 5-7 years in order to get the best value.
- Do you have steady income and good credit? Lenders require you to have a specific debt to income ratio to qualify for mortgage as well as a minimum credit score.
- Can you afford a down payment of at least 5% and closing costs? While there are options for borrowers with low to no down payment as well as closing cost assistance, the larger the down payment the lower the interest rate you may qualify for.
- Do you have adequate savings to withstand a financial setback or unexpected home maintenance costs? Having extra money in the bank is important in order to protect yourself from any unforeseen events.