Is buying really cheaper than renting?

It depends on where you live and what type of home you need, but for many, the answer is "Yes."

Many more may soon find themselves in a similar situation, paying more for rent than the cost of a house payment. In many communities this is already the case.

No doubt you have noticed what appears to be a building boom in construction of apartment buildings. There is the new complex at the site of the old drive in movie theater, the colorful apartments matching the scheme of Mill River on Seltice, the site on Ramsey where the beautiful retaining wall has been built next to Orchard Crest mobile home park and the project in Riverstone. One would think that enough is enough already but the indicators are that the need for rentals will continue to grow.

Some believe that, even with this apartment growth, occupancy requests will continue to be greater than availability of apartments. Our commercial Realtor members report a consistent interest from apartment buyers, with no inventory to speak of to sell to them. That being said though, it appears that the number of apartments, newly constructed and under construction, will not be for sale either. Largely, those projects are being built by folks who intend to retain ownership. Why? Because there is money in it.

Of existing apartments, vacancy rates are exceptionally low. As new apartments are finished and those older units become available, they are also quickly filled. We talked to one member who does property management and he told us that, of over 400 units managed by his company, there are only "four or five" vacancies.

As with all commodities, price is dictated by supply and demand. With such strong demand for apartments and with demand on the rise in our area, rental rates are sure to rise in the short term. For many, that will mean that detached housing becomes a better opportunity - not only for the monthly savings - but also for the opportunity to build equity, which is once again a reality for home owners.

The impact of these tenants cum owners will have its impact as well. If interest rates remain low, as the Federal Reserve has promised, and as rent increase, as they are sure to do, more competition enters the buying marketplace. These apartment dwellers, seeking affordable options, will put even more pressure on our diminishing inventory in the housing market. By the end of last year, we had 17 percent fewer homes on the market than we began the year with.

Even though Spring is the time that listings accelerate, we only have 4.5 percent more homes available today than at the end of last month. Take away those homes that are beyond $150,000 and you remove over two-thirds of our inventory, leaving the balance for those who are just entering the market.

If you are one of those people, and, if you have a down payment, your payment on your own $150,000 house would be about $670 a month. Of course, property taxes and hazard insurance will be in addition to that, but as rent increases on your two bedroom apartment, you will soon be money ahead, and you can't sell your apartment. To do your own calculations of buying versus renting, visit www.dinkytown.net for a simple calculator. This will allow you to factor in taxes, insurance and lending costs and will help you project your savings, or lack of, over time.

Trust an expert....call a Realtor. Call your REALTOR or visit www.cdarealtors.com to search properties on the Multiple Listing Service or to find a REALTOR member who will represent your best interests.

Kim Cooper is a real estate Broker and the spokesman for the Coeur d'Alene Association of REALTORS. Kim and the Association invite your feedback and input for this column. You may contact them by writing to the Coeur d'Alene Association of REALTORS, 409 W. Neider, Coeur d'Alene, ID 83815 or by calling 208-667-0664