Renting VS. Buying: Is the Risk Worth the Reward?
Buying a home is a huge financial investment. So much so, that oftentimes people think it's simply just easier and more cost effective to rent. Homeownership can be very rewarding if you are properly prepared, know what to expect, and make informed financial decisions. However, there’s more to comparing the costs of renting and owning than the dollar cost of payments.
This week, we're sharing with you some common thoughts that renters often voice when speaking about renting vs. buying a home.
“Investing in a home is riskier than renting.”
No risk, no reward. Besides, even studies conducted by the Federal Reserve show that owning can provide a net worth that is from several to hundreds of times higher than that of renters.
“Home values have dropped in recent years.”
Which is one reason why ownership may now be less expensive than renting. As well, recent price trends in many areas have reversed, and values are once again on the rise.
“The tax deductions aren’t worth it.”
Some people benefit from claiming deductions for mortgage interest and real estate taxes. Others find a standard deduction more valuable. Even if you exclude the tax benefit, the real cost of owning can still be less than renting.
Equity for you or equity for your landlord?
With more or less equal payments, owning will always have an advantage in that you’re paying down principal and earning equity in your own home rather than the landlord’s.
Ready to Own?
Still renting and want to explore the path to ownership? Reach out, and we'll be happy to help. If you're in need of a mortgage for a new home or have any other questions pertaining to mortgage lending, trust in the mortgage professionals at MHQ - Mortgage HeadQuarters to have your best interest in mind. We can help you choose a mortgage program that's right for you and your specific needs!
This week, we're sharing with you some common thoughts that renters often voice when speaking about renting vs. buying a home.
“Investing in a home is riskier than renting.”
No risk, no reward. Besides, even studies conducted by the Federal Reserve show that owning can provide a net worth that is from several to hundreds of times higher than that of renters.
“Home values have dropped in recent years.”
Which is one reason why ownership may now be less expensive than renting. As well, recent price trends in many areas have reversed, and values are once again on the rise.
“The tax deductions aren’t worth it.”
Some people benefit from claiming deductions for mortgage interest and real estate taxes. Others find a standard deduction more valuable. Even if you exclude the tax benefit, the real cost of owning can still be less than renting.
Equity for you or equity for your landlord?
With more or less equal payments, owning will always have an advantage in that you’re paying down principal and earning equity in your own home rather than the landlord’s.
Ready to Own?
Still renting and want to explore the path to ownership? Reach out, and we'll be happy to help. If you're in need of a mortgage for a new home or have any other questions pertaining to mortgage lending, trust in the mortgage professionals at MHQ - Mortgage HeadQuarters to have your best interest in mind. We can help you choose a mortgage program that's right for you and your specific needs!
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