Renting vs. Buying in Roseburg: Where $1,800 a Month Goes
Real Estate Broker · Douglas County, OR
Everyone needs a place to live, so renting is not a waste of money - you are paying for a roof over your head, and that is not nothing. But on a $1,800 monthly budget the difference is concrete. When you pay rent, that $1,800 is gone forever. On a first $1,800 mortgage payment covering principal, interest, taxes and insurance, about $210.94 goes to principal, $1,378.13 to interest, $147.50 to property taxes and $63.80 to house insurance. Renting only makes real sense in two situations: a very cheap rental that lets you save toward buying, or earning significantly more than your rent and valuing the flexibility to leave on short notice.
Everyone needs a place to live. Housing is a necessary expense. In that sense, renting is not a waste of money. It is not “throwing money away” because you are paying for a roof over your head, and that is not nothing! However, once you move beyond the basic “roof over head” need, there are major differences between buying a home and renting that you should consider.
The “throwing money away” concept finds its source in the fact that renting provides only limited benefits (roof over head, some utilities, etc), whereas homeownership provides a greater array of benefits (predictability, solidarity, hedge against inflation, wealth building thru debt pay down & rising property values over the long-term, etc)
When Renting Makes Sense
Renting only makes real sense in two situations: A) you have secured a very cheap rental (apartment above shop, RV spot, bedroom, etc) and it’s affordable enough to allow descent living and considerable saving for the future goal of buying. B) you make significantly more money than what you pay in rent and you value the flexibility of leaving the rental within short notice as compared to the somewhat immovable option of having purchased a home in a single location.
If the above situation(s) do not describe your current living situation, then you should seriously consider making a game plan to buy ASAP. Here’s why:
A $1,800 Cost Analysis
Let’s review a cost analysis using a monthly budget of $1,800 for our example. When you pay rent, that $1,800 is gone. Forever. Bye-bye. You will never see it again. When you make your first $1,800 mortgage payment that includes Principal, Interest, Taxes, & Insurance (PITI), about $210.94 goes to principal, $1,378.13 to interest, $147.50 for property taxes, and $63.80 for house insurance.
Housing Inventory
Months of Supply · 12-Month Rolling Average
Roseburg and Douglas County Real Estate (March 2023) Market Update
Comparing 2023 to 2022 over the last 12 months in Douglas County, the average sale price has increased 9.4% from $326,900 to $357,700. In the same comparison, the median sale price has increased 6.7% from $299,900 to $320,000. Inventory decreased to 3.3 months in February. Total market time decreased to 68 days.
Average Sales Price
12-Month Rolling Average · Douglas County
Related Reading
Housing Inventory is months of supply (active listings ÷ monthly sales). A balanced market is ~6 months. Days on Market (DOM) is days from listing to accepted offer. Absorption Rate is the percentage of inventory sold per month. Balanced = 15-20%.