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Whether you are moving to a new city for your dream job or need more space you've debated renting versus buying. Which is better? You may be thinking that renting has more freedom because you aren't tied down to a mortgage. Or that it's less expensive because you don't have to deal with the taxes or maintenance. But, many don't consider the many perks that come with buying a home.
Your housing payment is consistent:
If you can lock down a fixed rate mortgage your payments will remain consistent. But a landlord can raise the rent when the lease term is over. If the rent becomes more than you can afford, your only option is to move. Moving comes with its own expenses and challenges.
Equity:
Earning equity and a great return on your investment is a top reason people buy versus rent. A home is an asset that consistently appreciates over time. There is nothing like selling your home for more than you bought it for. You don't get this perk with renting.
You can design or modify however you would like:
When you are renting a home, you must ask the landlord's permission regarding modifications to the home. You can't paint without permission and remodeling the home is out of the question in a rental. Even if you do receive permission from the landlord to make changes to the home you have to return everything back to its original condition prior to moving out.
You can make your home more upscale:
When you own a home, you can make the place more desirable. You can purchase better quality appliances instead of the cheapest thing on the market. Why not install hardwood floors instead of putting up with shabby carpet? You have more control over the landscaping too. Why not put in a beautiful flower bed and trees in your lawn? You can even repaint the house if you would like to. These options are not as readily available to renters. Many developers will use thin plywood or inferior drywall when constructing rentals. They do this because it is cheap. But, it means you can hear more noise from your neighbors than you would like. When you own a home, you can easily make it more sound proof.
You buy less furniture:
Hodges brings up a good point. You really do buy less furniture as a homeowner. When you are renting you are moving around more and each place is different. If you move to a place with a bar you will want to make sure you have bar stools that fit in nicely. If your old place had lots of shelves you may find yourself needing to purchase additional shelves and storage items for your new rental.
Tax benefits:
There are several tax deductions you can take as a homeowner. Your interest payments on your mortgage are tax deductible and some home improvements may qualify for the non-business energy property credit. As you upgrade aspects of your home like outside doors, insulation, windows, or roofing, check to make sure they meet the efficiency standards set by the department of energy. You don't get these credits in a rental.
It's less expensive to buy than rent:
Wait, isn't renting supposed to be less expensive? That's why people rent versus buy right? Short-term renting is cheaper because you don't have to have to cover closing costs according to realtor.com. However, after the closing costs are taken care of a mortgage is generally less than rent. Reatly Trac stated that buying is more cost effective than renting in 58% of the U.S markets.
It's yours!
A landlord can non-renew your lease at the end of the term if they want to and it's out of your control. However, when you buy a home the only way you can get kicked out is if you quit paying your mortgage and go into foreclosure. This creates an added level of comfort and security for you.
Buying a home can be a great investment and it is surprisingly attainable. Once you are ready to settle down somewhere consider purchasing a home. From the freedom to decorate and remodel to the tax perks, there are so many benefits to homeownership. You don't receive these perks when you rent so consider buying instead.