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Best Foreclosure Homes: Weighing the Pros and Cons of Buying vs Renting

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By : John Cutts    99 or more times read
The best foreclosure homes available to those seeking to purchase their own property are the ones that can provide equity or those that will not depreciate in value over the coming years. If the value of the house available for purchase is likely to fall in the future, then home buyers can consider renting instead of buying.

According to Center for Economic and Policy Research co-director Dean Baker, the best method to use in evaluating whether renting or buying a house is the right decision, would be to divide the selling price of a home by the cost of renting a similar house in a comparable neighborhood for a whole year.

Baker stated that if the result is a number higher than 20, it is highly possible that the value of the house for sale will decline in the coming years and it would be better to rent instead. Baker further explained the idea of renting versus buying in a report that appeared in The Wall Street Journal.

Because of foreclosure problems, most real estate analysts have concluded that renting might be better than purchasing homes, particularly among retirees or those who plan on settling at one place for a long time.

But some market analysts have asserted that this does not mean that the best foreclosure homes should be ignored in place of renting. If an opportunity comes to buy a residential property that will likely provide equity, making the purchase would still be the right move.

One of the areas that real property experts are touting as a good place to make a home purchase is Greenville, South Carolina. According to them, Greenville houses are way below the national price average and could provide buyers with great deals. Even renters will be able to get great transactions at Greenville.

Phoenix, Arizona is another place recommended by market analysts. According to them, the city is oversupplied with residential properties and could provide low-priced deals. The place also has low services costs and a number of amenities that make it an attractive place for those looking to buy a home.

The best foreclosure homes are those that can provide buyers with a solid equity and a potentially profitable investment in the coming years. If a home is unlikely to offer any increase in value in the future, then home buyers can look into the prospect of renting instead.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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