So, the home buying idea has come to your mind, but you are still wondering whether it is better off than choosing home rentals. For millions of Americans, choosing between renting vs. buying can get tough. Likewise, you may be torn between to rent or buy a home. Ultimately, the choice depends on which of the two options offers more benefits. Therefore, in this post, we feature essential factors to consider when the thought of renting vs. buying comes to your mind. To put things into perspective, we consider the two sides of the coin.
Buying a home
Home buying is not only a matter of property ownership. Different advantages come with the decision to buy a home. So what does home buying mean? Let us start with the benefits associated with home buying.
Pros of Buying a Home
● Homebuyers Can Capitalize on Equity
One of the core advantages of buying a house is that property ownership creates an equity-building opportunity. Therefore, if the property value goes up, the property owner earns a higher profit selling the property. In that regard, home buying provides you with a valuable asset and an opportunity to achieve financial stability.
● Tax Benefits
Another top reason to consider home buying instead of renting a home is that the property taxes and the accounting costs are tax-deductible. The most considerable deduction is generally the interest you pay on the mortgage. Therefore, homebuyers can keep hard-earned money. The mortgage interest deduction means reducing your out-of-pocket expenses for the mortgage interest over the mortgage term.
● Enjoy Freedom to Make Modifications
Owning a home provides the freedom to make any modifications to your property. The property owner does not have to seek approval to repaint the property, leave alone, and add a new room. The property owner also gets an opportunity to define the room sizes and the floor plan that suits the family requirements. This is unlike renting a property, where the property owner has to seek the landlord’s approval to make any changes to the property.
● Comes with Sense of Stability
Owning a home comes with intangible benefits, including a sense of stability and the feeling of belonging to a community. Therefore, the property owner knows that he has decided to live within a particular locality for a longer-term. With renting, the tenants can be served with a notice to vacate anytime the property owner wants to sell or change the property usage.
Renting a Property
Home rentals come with unique benefits you may not enjoy if you choose the homeownership path. Let us analyze some of the top benefits of renting a property.
● Fewer Upfront Costs
One of the most significant reasons to consider renting a property is the fewer upfront costs associated. Unlike buying a property, there is no down payment, closing costs, and cost of hiring a buyer’s agent. Therefore, the decision to rent a property is ideal for persons who cannot afford the high downpayment associated with home buying.
● Freedom to Relocate
Compared to property ownership, renting provides the freedom to move at any time. Therefore, if you do not plan to stay in a particular city for long, renting a home is better than buying. With renting, you can move without paying the penalty so long as the lease period has ended. On the other side, buying a home makes it a little challenging to move to another city, especially if you have to sell the current property to afford a new home. For those reasons, you should purchase a home only if you plan to live there for a more extended period.
● Minimal to Zero Property Maintenance Costs
Another significant cost associated with property ownership is the requirement to pay for the property maintenance cost. By renting a home, the tenants do not have to worry about the cost of maintaining the property in its top shape. Instead, it is the property owner’s responsibility, ensuring that the property is well maintained throughout.
With property ownership, the buyer has to incur the annual property maintenance costs. This includes the cost of repainting the property, landscaping costs, and any repairs required to be made on the property.
The decision of renting vs. buying requires critical consideration of the factors we have highlighted. Of the two options, home buying takes a higher advantage, as it comes with a sense of security, and it is an ample business opportunity for the property owner. Therefore, if your financial situation is sound, you can consider property buying. Cheaper mortgage loans have helped millions of Americans rise to the status of property ownership. Talk to a reliable mortgage broker to understand the different mortgage loans available to first-time homebuyers.