The decision to rent or to buy is a common dilemma for most adults. But the current economic conditions place buyers in a more advantageous position than renters because it’s now actually less expensive (38% cheaper) to buy a home than it is to pay a landlord rent. If paying less for the place you call home is not enough to lead you down the path to home ownership, then we’re here to help you better understand with 6 advantages of buying vs renting.
6 Advantages of Homeownership
#1 Equity Each payment you make towards the principal of your home loan every month increases your equity: the percentage of your home that you own. When you are renting you are actually paying off your landlord’s mortgage debt and increasing their equity in the house.
#2 Rent Goes Up No landlord reduced your rent, right? As a renter you are at the mercy of your landlord. Rent typically goes up every year. However, mortgage payments can remain the same with a fixed rate loan.
#3 Tax Break When filing tax returns, you can claim mortgage interest as a deduction. Rent payments are not deductible from income taxes.
#4 Your Personal Touch When you rent, you live in a space not designed for you and without your personal touch. You don’t have the opportunity to select paint colors, remove or add a wall or take any sweat equity with you. When you own your own home you can make improvements to your property based on what you want. You can paint walls any color you want, update the kitchen, and add those special touches to your house to make it feel like home. Renters don’t have any long term benefit from investing time, money or sweat equity into someone else’s property.
#5 Appreciation As a homeowner you typically can gain from the appreciation on your home. Repairs and upgrades (those personal touches) to your home (especially kitchen and bathroom renovations) tend to add value to your home. This is why homeownership is considered the best long-term investment any individual can make.
#6 Pride of Ownership There is a great deal of pride, comfort and stability in owning your own home. Homeownership gives you a joy and happiness that’s hard to describe. But some of the highlights of homeownership is having privacy, entertaining friends and family, having pets without paying a deposit, and the freedom start to your own garden, if you like.
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