A few factors should be considered when determining if you should buy or rent a home.
Current Market Situation
It is worthwhile to evaluate the current market when determining if now is the best time to buy a home. As it stands today, interest rates are remarkably low. Therefore many people are finding it better to buy than rent because it is possible to buy a home and pay the same or less per month than a current rent payment. In addition the housing market has rebounded from the recession making purchasing a home a wise investment. It is likely the home will gain value in the future meaning you will make money if you decide to sell down the road.
Some consider one advantage of owning a home is that the owner is able to remodel as they like. Homeowners can paint the walls, upgrade appliances, remodel the bathrooms, install a pool, etc. Any change they desire within the city code is possible. Renters are not able to make any changes.
On the other hand, if you own a home and a repair is needed it is your responsibility. No one else will handle the repair for you. Homeowners should either be handy or ready to hire someone who is handy for maintenance. Purchasing a new home reduces the amount of maintenance you will need. If you do not look forward to repair projects consider buying a new home.
Although the landlord will take care of maintenance for renters sometimes renters are still frustrated. Landlords don’t always complete maintenance in a timely fashion. Or they don’t keep up with things as well as the renter would like.
Initial Investment vs. Tax Benefits
Purchasing a home requires an initial investment. You will have closing costs and a downpayment on the mortgage. In comparison the security deposit for a renter is typically significantly less expensive. On the flip side, a renter will have no tax benefits. No aspect of the security deposit or monthly rental payment is tax deductible. For a homeowner the interest paid on the mortgage is tax deductible for those that itemize their taxes. The tax savings can be significant with this deduction incorporated.
Many people say that one advantage of being a renter is the ability to move at the end of the lease. Keep in mind that the landlord is not required to renew the lease either. So a renter may intend on staying only to find out that the landlord has decided to sell or even move into the property himself. Therefore the renter is asked to leave and has to find a new living accommodation unexpectedly. A homeowner has the security of knowing that they will not be asked to move as long as they continue to make their mortgage payments.
Contact us at Trumark Homes to learn more about owning your first home. Enjoy the ability to remodel, the security of knowing you won’t have to move unexpectedly, the tax benefits, and the investment potential of being a homeowner.