Buying a new house has always been part of the American dream, but in the wake of the recent housing crash, new generations of homebuyers are treading more carefully.
While renting is more flexible and adaptive, buying a house has a bigger potential long-term payoff, with tax advantages and quality-of-life benefits.
A Comparison of the costs of buying is more varied and complicated than for renting, so it’s important to look beyond just the figures when making your next move.
You “Settle down” When You Buy a Home
Although it’s ideal to rent if you do not have plans to be staying long or if your plans are not certain, however, that kind of flexibility comes with a price. It’s harder to feel comfortable in a neighborhood if you aren’t a homeowner.
Most real estate agents say the main thrill of selling houses is watching people put down roots.
When a client buys a house, they settle in and create a community. An added benefit is that you have the right to paint the bathroom, restructure or put in a rose garden without asking permission.
Home Ownership is a Sort of Savings Account
There’s no place like home. That’s true even if you only have eyes for the bottom line. When you buy a house, you enroll in a forced savings plan. No matter how tight your budget is, you somehow find the money to make your monthly mortgage payments. Month after month, you pay down the mortgage and increase your equity. Over a lifetime, home ownership helps you build and gather your wealth.
Buying a Home Has Big Tax Advantages
When you purchase a house, you can count support from Uncle Sam. The significant tax benefits of buying over renting may be reason enough to invest in buying. Homeowners have the choice to deduct mortgage interest on their federal income taxes.
This act is a hefty deduction for many individuals because interest payments are, however, the largest part of your mortgage payment in the early years of owning a house. You also have the liberty of deducting some closing fees and your property taxes.
Paying a Fixed Amount of Mortgage Stabilizes Your Budget
As anyone who has rented a home knows, a price increase of the rent is the norm and often out of our control. If you are living in a region without rent control, the landlord can raise the rent whenever they like without consequences.
Even with rent control, there are always exceptions, and you can’t be sure your rent would remain stable. However, if you buy a house and take out a fixed rate mortgage, your house payment stays the constant throughout the life of the loan, even if it’s 100 years.
The Cumulative Cost of Buying a Home Costs significantly less than Renting over Time
Buying is the cheaper alternative over a long time. At the very beginning, your mortgage payment may initially be more than you’d pay while renting, you will spend less over the life of the loan if you buy. Rent prices may increase over time. Also, due to the tax benefits of home ownership, your true out-of-pocket costs from day one could still be significantly less than the amount you would pay while renting.
When you factor in the possibility that real estate values most of the time go up over the years, home ownership looks even appealing. The cherry on top is that when your mortgage is paid off, you can stop making payments, but you keep the house.
Finding Your Perfect Home
HomesIn is a community of websites designed to bring community marketing together with real estate. As an online, community marketing system, HomesIn helps to connect buyers and sellers with a real estate agent that know the ins and outs of their community. With one exclusive agent or team per town, HomesIn strives to make the experience of home buying and selling community oriented.
By connecting Homesin with community websites, customers can easily find new listings alongside business promotions in the area. In turn, this helps generate even more leads for the real estate agents, helping them to further assist their community.