You've just found out you will be relocating to a new city! Should you Buy or Rent?
First and foremost, understand what's included in your relocation package if your company is providing one. Some relocation packages provide:
Mortgage Down Payment Credit or Salary Advance
Mortgage Interest Rate Buydown
Temporary Corporate Housing
30-Day Storage of goods with a moving company
A Recommended Realtor® that specializes in the area.
If you don't understand a clause in your relocation package, do not be afraid to ask! These terms will likely sway your decision to buy or rent a home in your new city by making one of the options more appealing. I purchased my first house due to a corporate relocation with all of the above perks.
If your package includes a designated Realtor, contact them right away. Otherwise, find a local real estate agent by asking for referrals from any friends or company contacts in the new location, or do a Google or social media search for agents in the new location with relocation experience. Talking with a Realtor will be the quickest way to learn about local neighborhoods and get accurate pricing for both rentals and purchases. Once you've found a Realtor who's knowledgeable about the area, discuss what you're looking for in a home to better understand the cost of renting vs. buying and see what is available in the area.
Online mortgage calculators will help you estimate your buying ability. If you don't have at least 5% of the estimated purchase price to put into a down payment, or you have reason to believe your housing needs will change in the next few years, or you have doubts about how long you'll be staying in this new city, renting will likely be a better initial option for you.
If you calculate buying to be significantly more cost-effective than renting in the area, and you want the additional freedoms and are comfortable with the additional responsibilities that come with ownership, and you feel confident in the long-term prospects that your new job and new city will offer, ask your Realtor for a lender referral. Talk to the lender to understand your mortgage options and get pre-approved. Because you are on a tight timeline, you are looking for a lender with a history of closing on-time. It is also important that you respond quickly and thoroughly to the lender's requests for tax returns, bank statements, W2's, etc.
If you decide to buy and you don't have at least a month and a half between signing your offer letter and the date you need to move, you'll need to investigate temporary housing accommodations. The home buying process often takes a minimum of two months from start to finish. If necessary, consider storing your household goods as a part of the move. You do not want a moving truck showing up, when you don't yet have access to your new home.
Feel free to email me at firstname.lastname@example.org with real estate questions. I'm a real estate broker with Center Coast Realty in Chicago, working primarily with residential renters, buyers, and sellers. Additionally, I have moved three times under corporate relocation policies. #corporaterelocation #relocationpolicy #buyorrent #chicagorealestate #centercoastrealty #chicagocondo #primedwell