Buy vs. Rent

Home-Ownership Advantages

When you are considering the question of buying a home vs. renting one, there are many things to consider. You may have your own personal, subjective questions that only you will know and can answer, so we will concentrate on the more objective aspects of the own vs. rent question. The first step is to get pre-approval for your loan.

Tax savings play an enormous role in comparing own vs. rent on a cost basis. Listed below are the tax savings you will receive when owning your home.

  • You can receive a tax credit of 20% on the annual interest you pay on your mortgage.
  • You will get a tax credit every year you live in your home.
  • You will receive a tax deduction on the remaining 80% of the annual interest you pay on your mortgage.
  • You will receive a deduction on the property taxes you pay each year.
  • When the tax advantages and the present low interest rates are combined, it’s very possible for a new homeowner to have equal or lower monthly mortgage payments compared with rental payments for a comparable-sized living space.

Other Home-Ownership Advantages

  • Equity. Mortgage payments let you build equity (a savings account of sorts) in your home, while money paid for rent will never be seen again.
  • Predictability. Your fixed-rate mortgage payments will always remain unchanged, while rent can certainly rise depending on your landlord and market conditions. However, the property tax and home insurance portion of your mortgage can rise and fall.
  • Freedom. When you own your home you have the complete freedom to finish, construct, decorate, landscape, and furnish your home exactly as you would like. This usually gives people a sense of pride and accomplishment.

Home-Ownership Disadvantages

  • Requires More Permanence. Generally, you shouldn’t buy a home unless you intend to stay at least three to five years; otherwise, you may lose money if you sell due to the costs of selling your home.
  • Responsibility. Because you no longer have a landlord, it will be your responsibility to maintain your home.

As you can see, buying a home can be very beneficial for you, though perhaps it’s just not for you at this time. If you think you do would like to buy a home and talk about it more in-depth, please contact Command Home Mortgage, because cost-wise, this is a great time to buy—maybe the best in many years to come.

If you’re ready to get started, click here to learn more about loan pre-approval.

Contact Command Home Mortgage to learn more, or to get started buying your new home today!