With summer traditionally being prime home-buying season and home prices leveling off in the Inland Northwest, potential homeowners face a critical decision: should they buy or rent with interest rates hovering just below 7%?
The answer depends on individual circumstances and financial readiness, according to John Smith, director of residential lending and sales at Washington State Employees Credit Union.
“So prices have gone way up. Interest rates are maybe more than what they were three or four years ago. So the ability to buy, the ability to afford to buy, is sort of challenged at this time,” Smith said.
Higher interest rates typically reduce buying activity, but that doesn’t eliminate homeownership as an option. Smith emphasizes several key factors potential buyers should consider when weighing their options.
The upfront costs of homeownership far exceed those of renting, requiring significant financial preparation.
“So you’re got to be prepared with things like closing costs, your down payment. Those are large investments that you’ll have to make, so be ready there,” Smith explained.
Beyond initial expenses, homeowners must budget for ongoing maintenance fees and costs that renters don’t face.
However, for those focused on building long-term wealth, purchasing remains the superior choice.
“You won’t have the wealth creation in a rental that you will in buying,” Smith noted.
Smith recommends potential buyers take a step back and carefully examine their budgets to determine realistic spending limits.
“What can you really afford so you can be comfortable with life and not overburdened with financial payments and monthly expense?” he asked.
This financial assessment might require lifestyle changes, such as canceling food delivery services, streaming subscriptions, or reducing daily coffee purchases to save money.
For those seeking guidance, Smith points to several available resources. HUD counselors provide valuable assistance, and local credit unions often offer services through community homeownership development teams that specialize in counseling.
The Washington State Housing Finance Commission serves as another valuable resource for individuals deciding between buying and renting.
While current market conditions present challenges, Smith emphasizes that professional guidance can help potential buyers navigate their options and make informed decisions about their housing future.
COPYRIGHT 2025 BY KXLY. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED.