One of the main benefits of buying a home vs. renting a home (or apartment) is that your mortgage interest that you pay each year is tax deductible. This can help at tax time to get more money back from the IRS. Another advantage of buying vs. renting is that with buying a home you are actually investing your money into a fairly safe investment. Unlike renting, when you are basically just throwing your money out the window.
To rent or to buy is a complicated question loaded with personal, lifestyle, and financial considerations as well. Deciding whether to rent or buy means taking a long, hard look at both your feelings and your finances. Many people know there are tax advantages to owning, but it’s only one of many factors to consider.
How do you build equity in this declining market?
Another benefit in buying a home instead of renting is that you will be building equity. Your equity can later be turned into cash.
Owning your home vs. buying represents much more in terms of freedom and security. Very few renters actually realize that on a month to month rental the landlord can ask them to leave with only 30 days notice. This can usually be done without cause, meaning that they normally would not need a reason to do this. In many cases, rental properties have restrictions on how many persons may live in the property, pets, number of automobiles allowed, and many other things that can affect the way the renter lives.
Ask your mortgage professional to provide you a detailed analysis of the benefits of buying vs renting. You will see many benefits of buying.
There are many rent vs buy calculators available online that will help demonstrate the advantages of homeownership compared to your current renting situation. These calculators provide all different kinds of information such as tax savings, equity gained, and a breakdown of differences between the payments.
Another advantage to buying a home is that you are locking into a payment. As in most cases rent will increase yearly while your mortgage payment may stay the same up to 30 or 40 years.
Keep in mind that owning a home has many responsibilities too that renting does not. A homeowner needs to upkeep the home. If the furnace goes or the hot water heater quits a homeowner needs to take care of these items. As a homeowner you must make sure that your property taxes and homeowners insurance get paid. Also, as a homeowner you must upkeep the exterior of the home, the yard, landscaping etc... While these responsibilities do exist for a homeowner the benefits of owning your own home still outweigh and are much more rewarding than the benefits of renting. Your home should always appreciate in value and you are going to basically make money simply for living there and making your monthly housing payment.
For many people, psychological and emotional factors drive their decision to stop renting and buy a home. These factors include pride of ownership, a feeling of establishing roots, a desire for a place to raise a family, desire for privacy, and freedom - freedom to paint your walls any way you want, freedom to barbeque on your own back porch, freedom to play with your dogs in your own back yard.
The question of whether to buy or rent comes up with many home buyers. There is a large advantage to buying in that you gain money when the home appreciates. Also, your home is leveraged so the appreciation can be significant compared to your initial investment.