The age old question, “Should I rent or should I buy?”
This debate has been going on for what feels like an eternity and it can leave someone in the market for a house with a lot of questions that aren’t so easily answered. One of the biggest benefits of buying a house is the home mortgage rebate tax. Unfortunately, there is no rental tax rebate so a lot of money is left on the table when you choose to rent instead of buying a home.
As a whole, it is cheaper to have a mortgage than it is to rent in the majority of the countries around the world. Near-historically low mortgage interest rates have a lot to do with this, as they are around 4%. Also, consider that when you rent a home, the money is gone and goes into someone else’s pocket. Year after year you pay rent. You have a roof over your head, but you have accumulated no equity when you are ready to move on. When you buy property, the money that you put into the house is an investment towards your future. Realtor.com is forecasting housing prices will rise around 5% this year alone. So when you choose to move on from the house that you are in, you will walk away with the money that you put into it, instead of walking away with nothing, which is the case when you rent.
One of the few downsides to buying a house is that you are responsible for maintaining the property. As you maintain and upgrade your home it pays off when it comes time to sell, as this adds to the value of the home. In addition, you increase the curb appeal of the property, so you will have more potential buyers.
Another benefit of buying a home instead of renting is that it is your home, you can do with it whatever you wish. Personalize your home by painting it any color, make any additions that your heart desires so you make it truly your own. When you rent, you cannot make substantial changes, like renovations or even paint without expressed permission.
Here are just a few more perks on becoming a homeowner:
As a homeowner, there are many things that you are entitled to when it comes to tax deductions such as property taxes, and mortgage interest on your primary residence as well as the second one. There are limits but the number of taxpayers affected is minuscule.
When you rent, your hard earned money goes directly into your landlord’s pocket. When you buy a home, you are building equity as you pay off the mortgage.
When you buy a home you have the potential to earn extra income by renting out your property, or borrowing against it if the need arises.
When it is time to make a decision, buying a home is the winning choice. When you buy a house there is just too much upside with little downside. Remember to take these things into account in a lot of ways buying a home is more than just numbers and tax deductibles. It is your home, where you will watch your children grow, throw parties, grow old. You will experience all of the things that this world has to offer while having the comfort of knowing where you will lie your head down at night. You will be rewarded with many years of pride and joy.