Buy or rent? Here are some pros and cons

Price. Location. Personal preference. There are so many variables that it’s hard to make blanket statements about buying versus renting. But there’s a case to be made for either right now. A few things to think about:

The case to buy

•Money’s cheap. At 4.2%, the average interest rate on a 30-year mortgage is near record lows. Many economists predict it’ll be north of 5% by this time next year. Waiting could prove costly.

•Prices appear stable. The big jumps of the last two years are probably in the past, but most forecasters say they think modest price gains will continue in the next two years. Few expect they’ll fall any time soon.

•If you plan to hold, you can win. Housing counselors say if you plan to live in a house more than seven years, buying will almost certainly come out ahead of renting. Between the tax breaks and the “forced savings” of a monthly mortgage payment, owning tends to pay off in the long term.

The case to rent

•Renting is simple. The only thing a renter needs to pay is the rent and utilities. Owners are on the hook for virtually everything, from taxes to a new hot water heater. Those extras can add up, and sometimes when you least expect them.

•We live in uncertain times. Want to move for a new job? Just got laid off and need to downsize? It’s a lot easier to break or wait out a lease than it is to sell your house, especially if the market’s in a down cycle. That flexibility can be valuable.

•Buying has gotten costly. Yes, the rent has risen. But the mortgage has gotten even higher. In some parts of Southern California, sale prices have surged far faster than rents.

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