Memphis Condos – Should You Buy Or Rent?

If you have ever considered the condo lifestyle and are interested in Memphis, Tennessee, now just might be the best time in recent history to make the move. With a surplus of units on the market creating motivated sellers and mortgage rates at all time lows, it could be the “perfect storm” of ideal conditions for the purchase of Memphis condos. You should have a better feel for the major factors that go into the buy vs. rent decision when you are done reading this article.

A recent study revealed that there are over 500 condos, town houses, or lofts for sale in the Greater Memphis market at any given time, compared with just over 60 units available for rent.  With the amount of inventory available to buy and the current state of the economy, it would seem to indicate that it is better to buy right now then to rent. 

We all know the news stories about job losses and foreclosures.  And while none of us enjoys the suffering of our neighbors, the poor economy does make for a higher than normal number of “motivated sellers.”  These folks are often facing a situation where they are unemployed or underemployed and can no longer afford to pay their mortgage.  And to add insult to injury, many of them are upside down on the value of their condos.  This means that they owe more on their unit than it is worth and are facing either a short sale or a foreclosure.  So there are many deals to be had in the current condo market for sure.

In addition, mortgage interest rates are at or near all time record lows, with 30 year fixed rates hovering right around 5%.  This is a far cry from the economic woes of the late 1970’s which saw mortgage rates approaching the 20% mark!  Funding your condo purchase will literally probably never be cheaper than it is right now, so why not lock in these great rates before they adjust upward?

On the other hand, some would argue that regardless of the available deals on purchase price and the low mortgage rates, it may still be wiser to rent for a period of time rather than to buy.  These folks say that factor like getting to know a neighborhood and the amount of time you plan to be in a location or just as important as price and rates.  They argue that far too many people have rushed into the purchase decision only to regret it later when they came to realize that the condo development or neighborhood they thought they were buying into was not as it appeared.

Others have purchased quickly after a job transfer or military relocation only to be relocated in a couple of years later. These folks found that their homes had not appreciated fast enough (or at all in some instances) to even cover the selling costs they would have to cover just to get out of the property, thus making them among the motivated sellers discussed earlier.

So while it is true that there is an abundance of Memphis condominiums on the market right now and that mortgage rates are fantastic, the decision to buy vs. rent must be made with an understanding of all the factors that input your particular situation in order to know which would be best for you.