Renting an apartment getting awfully expensive in Chicago
Looking for another reason to buy a home? Here’s a good one: Renting an apartment is getting more expensive.
The Apartment Guide recently released its 2019 Annual Rent Report, finding that apartment rents across the country rose 4.2 percent for one-bedroom apartments last year. By the end of 2018, the average monthly rent for these apartments stood at $1,140.
It’s even more expensive to rent a two-bedroom apartment, with Apartment Guide reporting that the average monthly rent for these apartment types stood at $1,354 a year.
And what about in Chicago? The average one-bedroom rent in our market hit $1,918 at the end of 2018. That’s up 3.1 percent from the end of 2017. And two-bedroom rents soared even higher, with Apartment Guide reporting that the average rent for these units hit $2,795 at the end of last year.
That’s a jump of 5.6 percent from a year earlier.
It’s true the buying a home in Chicago is getting more expensive, too. After all, Chicago home prices have risen steadily for the last several years. At the same time, mortgage interest rates are also rising, making it more expensive to take out a mortgage loan.
But owning a home in Chicago, even with these factors, can still be less expensive than renting an apartment, especially if you are looking at more modern apartment units. And as rents only continue to rise, buying a home looks ever more attractive financially.
And remember that when you own a home you can build equity. Equity is the difference between what you owe on your mortgage and what your home is currently worth. If your home is worth $200,000 and you owe $120,000 on your mortgage, you have $80,000 or equity.
You can borrow against that equity in the form of home loans or lines of credit as a low-interest way to pay for everything from home repairs to college tuition. You can also use these affordable loans to pay off high-interest-rate credit card debt.
If you build enough equity, you can also earn a solid profit when it’s time to sell your home. When you’re paying rent? You’re sending money to your landlord. You’re not building anything.