Financial Matters

Is Buying a Home More Viable to Renting?

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Is Buying a home more viable to Renting?

Settling down is inevitable, and when it happens, it all comes down to Buying versus renting. As much as a sense of ownership is what we seek to establish, it is not always that we bump into a pot of gold. Low mortgage rates and escalating apartment rents in numerous cities have brought about the divide into home ownership. Is there a right answer? And if so, by how much is renting out a place a more impractical option to buying?

Advantages of Buying a Home

Pull out your yellow legal pad, its pros and cons time! When it comes to buying, net costs compare to the total amount you would spend over time, not including the potential value you might probably receive if you sell the property. From this, one can build equity as homes rise in value anywhere. Consider it an investment, a bought home can be rented out or sold off to generate income. Furthermore, when it comes to mortgage interest payments, deductions from itemized federal income taxes can counterpoise the cost of housing. Owning a home is the final touch the settling down opus, developing an association with a community, a neighborhood, not to mention the freedom to beautify as you please.

Buying a home gives you the freedom to be as creative with your home as you would like. You can paint whatever color you want, have as many rooms as you would like etc. In other words, you get to design your dream home!

Comparing the total cost of renting to that of buying won’t be easy, with annual property tax and mortgage terms for buying and rent appreciation, rent insurance and price appreciation strongly influencing rentals. Renting offers flexibility and freedom to move or relocate easily that you cannot find in built equity. Additionally, with little to no maintenance required, you can avoid owning a depreciating asset. But a coin has two sides. As the tenant, you have no control over rent increases, and with a greater budget on the table, you don’t build equity. Despite the freedom, there is a limit. Renovation, remodelling and repainting is not covered in that umbrella, thus making buying a more viable option. In fact statistics show that renting can now cost you more than buying a home.

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Time Is Money

How long do you expect to live there? Buying a home is a major investment and one can recoup the costs, in five years or less. If you are single, hoping to be married, you might want to look into home purchase. Married people that hope to start a family should probably start a housing budget to accommodate its newest members and probably accommodate for a reduction in income in case of a spouse will stop working.

Given our major factors to be time and money, and with reference to a consensus done over thirty years, a comparison of the two can be done, keeping factors such as city choice, as undefined and closest to standard. In closing, compare what you will get as bang for your buck , who stands to be enriched your landlord or you? Weigh your options thoroughly!

 

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