Home rental costs have been rising for quite some time, and this situation shows no signs of letting up. Some blame availability and others point to stable interest rates for the lack of affordable rental units in many locations. Whatever the reason, it will have renters considering buying a home of their own. To help you decide, take a look at some thoughts on renting vs buying.
Nail Down Your Housing Costs
Just when you have your budget all figured out, the property management company that rents to you raises your rent. With a home purchase, you can count on your mortgage payment being the same every month for the life of your loan. Unless you refinance (for a lower interest rate and lower payment) or have the type of loan that uses variable rates, your housing expenses will change little in the future.
A Real Community Connection
Unless you have owned a home in the past, you might never consider the community aspect of being a homeowner. There is something about having a stake in a neighborhood or town that differs from just renting. That might mean you are more interested now that you are an owner in things like zoning, property values, new industry, local politics, and more.
Mortgage Payments May Be Lower
Some former renters are shocked when they discover that their new mortgage outlay is less than they were paying in rent for an equivalent property. If you are still making rent payments, do yourself a favor and get a pre-approval from a lender. That will tell you several things. It will provide you with a monthly payment to expect along with how much home you can afford.
You Are Building Equity
A home is not just a place to live. If you are making mortgage payments rather than rent payments, you have an investment. Real estate is an unbeatable way to grow wealth. You have to live somewhere—you might as well use your hard-earned income as an investment too. When you move, you will realize the gain in home value. As a side note, you may gain a tax benefit. You can use some or all of your mortgage payments as a tax deduction.
It's All Yours
It can be frustrating to live in a rental where you cannot make the changes you envision. Owning your own home means you can paint, knock down walls, add nicer flooring, and whatever else you desire. It might also mean adding a furry family member that was not allowed in your rental. Pets by the dozens need homes, so check your local animal shelter.
These are just a sampling of the good things in store for those that switch from renting to buying. Speak to a real estate agent in your area to find out more.