Why RENT when you can BUY?
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Why RENT when you can BUY?


Why RENT when you can BUY?

The debate continues. Everyone will ask themselves at some point in their lives if they should rent a place or make the jump and buy a home. Which is the best decision financially? What option is more beneficial in the long run? In the end, if you’re able, buying is always the better way to go. Here’s why.


1. Building Equity

When you rent a home, you are essentially paying your landlord’s mortgage. Their bank account is reaping all the benefits, and you won’t ever see that money. Why pay off someone else’s mortgage when you could be paying off your own all while building equity in the process? One of the main benefits of homeownership is the ability to build equity (the current value minus the mortgage owed on the house) over time. As you pay your mortgage every month, you increase your home’s equity. Thus, as time goes by, it grows! If the equity in the home grows to a 20-to-80 percent loan-to-value ratio, you will be able to borrow against your equity in the home. If you’re eligible for a home equity loan, this could be used as access to more money – student loans, anyone? Want to do some renovations?


2. Tax Deductions

The biggest tax break comes from deducting the mortgage interest you’re paying, but the list doesn’t stop there — equity loan interest, points, property taxes, home improvement loan interest, moving costs, selling costs, and mortgage tax credits are all deductible (consult with your CPA about this). Homeowners have many more federal income tax deductions than renters. Thank you, Uncle Sam! In addition, the IRS won’t apply a capital gains tax on your profits from the sale of your home in most cases. You can keep the first $250,000 in profit when selling the home if you’re single (or co-owners who separately qualify) or the first $500,000 if married. WOOHOO!


3. Maintenance Choices

If you rent, you hardly have a say in how maintenance issues are addressed, and you will most likely be paying a fee. If you are a homeowner, you decide how the issue gets handled, whether it’s you or a contractor and you have control over the timeliness of the repair or improvement.


4. Customize Your Home

Owning a home means you have a freedom that renters don’t. You want to update the cabinets? Go for it. It’s your kitchen. You’d prefer multiple wall hangings? Grab the hammer! Your home is an investment that you can creatively attribute to and you have the pleasure of remodeling your home as you see fit. You have the flexibility to have pets, your own garden and so much more.


5. Did We Mention Freedom?

Speaking of pets, there are no more pet deposits or adoption hoops to jump through. Animal rescues are even more likely to send an animal home with you knowing that you’re a homeowner. Plus, there are no longer pesky neighbors above or below you disturbing the peace!


6. There’s Plenty of Help Along the Way

Buying a home may seem overwhelming, and we aren’t going to lie to you, it can be. But there are plenty of people available to make this process much easier on you. An obvious one is your real estate agent. Our job is to be by your side from start to finish; we will help with any questions, concerns or suggestions you have during the process. Loan officers are also available to evaluate, authorize or recommend approval for different types of loans. Some loan officers even offer lease/rent buyouts so you can move forward on purchasing a home without waiting until your lease is up. Our friend Shawn Kaplan with Legacy Mutual Mortgage wants to help create homebuyers NOW vs. later. He can help you get up to $2,000 credit toward your lease or rent buyout. So don’t fret! There are plenty of resources for you along the way!


The only reason you shouldn’t buy is if you don’t have a down payment. Even if you will only be there a year, the market is increasing tremendously – you would most likely end up making money in the long run. Feel free to contact us with any of your home-buying questions. That’s what we’re here for!