Should You Buy or Rent?

October 8, 2004 – Posted at 3:30 p.m. CDT

JONESBORO -- Low interest rates have prompted many renters to become homeowners. But is it better to buy or rent? It's one of the biggest decision you'll ever make...owning a home.

"This will be the best year I've had in real estate, so I'm very pleased with that," said real estate agent Lynn Ward.

Ward isn't worried that housing prices have risen about 25% faster than rents since the mid 1990s.

"It's just money that you are giving to the landlord and you're not getting anything back, you're not putting anything back for yourself," said Ward.

She knows the value of owning your own home.

"You build up equity, it's money you're putting back for yourself. If you are renting, the landlord, you're not building any equity with him," said Ward.

Last year 7.2 million Americans purchased new or existing homes, up 10% from 2002. This year, 7.9 million Americans will be buying a home.

"I see a lot of people right now moving up. Taking advantage of the lower interest rates and to get a larger home. They are getting more home for their money," said Ward.

Nationwide, median home prices have risen 47% over the last decade, but it's kind of like comparing apples to oranges.

"A house that is $100,000 dollars here might be $400,000 dollars in New York, and that's a big, big difference," said Ward.

The average cost of a home in Jonesboro is about $110,000 dollars. Because so many are buying homes right now, the national vacancy rate for rental properties is now at a record high of 10.5 percent.