The account below is a true story from one of our clients. To protect their identity, we have used fictitious names. However, their stories, stats, and emotions are real. This is the next installment of our “Be Like” series.
Like many young adults, Chad moved back in with his parents after college to start saving money. But after two years and at age 25, Chad was itching to get his own place. He was also eager to get a dog he could raise and take along with him when he goes running, a hobby he’s very passionate about.
Chad started looking at rental properties and was close to signing a lease for $1,810/month. He was ready to be on his own and could afford it, after all: He was working as an engineer at a local manufacturing company, driving an older 2007 Toyota Camry, and saving money while he lived at home.
Before signing the lease, Chad talked to his brother, who told him, “Don’t do it – that rent rate is crazy high and you can own for less than that!” He had heard about the more common benefits of owning a home but had no idea it could be cheaper than renting. Chad’s brother recommended getting in touch with his realtor, Jarrod Peterson with the Jarrod Peterson Real Estate Group of Edina Realty.
At first, Chad was hesitant. He didn’t want a pushy realtor just looking to make a quick sale. However, his brother reassured him that Jarrod and his team were seasoned professionals who would help Chad make decisions that were right for him. Chad decided to take the advice and called Jarrod to set up a meeting.
As with most of Jarrod’s buyer meetings at the time, their initial meeting took place remotely via Zoom due to the COVID-19 pandemic. In that meeting, Chad expressed his desire to move out of his parents’ home in Champlin and into his own place. He also explained his financial goals, personal wishes for the ideal home, and budget.
Jarrod quickly determined that Chad’s brother was right: Based on their discussion, he could find a home for around $1,200/month – over $600 less than the lease he almost signed! Chad was shocked and very excited to move forward, and Jarrod was happy to help him through the buying process.
Finding the Perfect Home
Since he’s not a mortgage lender, Jarrod referred Chad to one of his leading lending partners. After running the numbers, the lender officially assured Chad he could, in fact, purchase and own a home for a significantly lower monthly cost than renting.
At that point, the hunt was on. They decided to focus their search to townhomes and looked at properties all over the north metro. Before long, they found a perfect match with a development in Blaine. It was close to Chad’s work and featured amazing amenities: outdoor pool, exercise room, clubhouse, and more. Best of all, he could get the dog he always wanted.
Chad was thrilled and couldn’t wait to move into his new home. And despite the association fee that comes with any townhome complex maintained by a homeowner association, he’d still be saving money. He was able to drop his monthly gym membership since he has an on-site fitness facility, and the association fee also covers sanitation, outdoor maintenance, and snow/lawn care.
Benefits of Owning a Home: Stop Paying Rent and Invest in Yourself
The bottom line? Chad will tell you his monthly payment is $1,255 including taxes and insurance. Add in the $240 monthly association fee and his total payment is $1,495/month – $315 less than the renter’s lease he almost signed. Plus, Chad has access to beautiful shared amenities and can experience the other benefits of owning a home: He builds equity and credit by paying for property he owns instead of paying a landlord, reaps annual income tax benefits by deducting mortgage interest and property taxes, and does not need to worry about annual rent increases.
Chad is taking more control over his investments and finances as a homeowner. And he’s already putting his savings to good use, using the $300+ in his monthly budget to pay down student loan debt. What a smart investor – who is investing in himself!
Be Like Chad: Partner with the Pros and Own Your Investments
Want to be like Chad and experience the benefits of owning a home? The experienced professionals at the Jarrod Peterson Real Estate Group want to help! We’ve been a leading private practice within the Edina Realty brokerage for the past 15 years, and we’re the proud recipients of over 74 local and national awards for our exceptional level of sales and service. Most of our 1,260 satisfied clients come from the Twin Cities and Central Minnesota, and we work with all types of clients.
From first time homebuyers to seasoned investors, we’re passionate about using our expertise to help our clients achieve their real estate dreams. Contact us today to schedule a meeting and learn more.