That is the question! Many often wonder which is less expensive, to rent a home, or to own a home? The answer helps families make the decision whether or not to buy. There are some obvious reasons to own instead of rent, like being able to customize the space and not having a landlord. When you are renting, the space is not actually yours, so if you want to paint some of the walls or do some minor renovations, that is not an option. You also have a landlord, which means that when something is broken, it is out of your hands.
Some benefits of becoming a home owner in today’s market include low mortgage rates and tax deductions. A huge benefit of home ownership is being able to deduct things like mortgage interest payments and property tax payments. Itemizing deductions, or even taking the standard deduction, saves money and makes buying cheaper than renting in some cases.
Interest rates have risen, but still remain historically low. If you choose a fixed mortgage rate then your monthly payment will not change, unlike most rents, which tend to rise every year.
Another factor to consider is how long you plan on living in the home. If you are uncertain about whether or not you may want to move again soon, then renting is probably the route to take. If you are certain that you will stay put and decide to purchase, then the longer you stay in that location, the lower the cost of owning, according to the National Association of Realtors®.
“The numbers on housing have an important message for American families today, and particularly young families setting out on life’s great adventure: Five years ago, at the peak of the home buying euphoria, it was emphatically a time to rent. Today, when home ownership is depreciated more than ever before, the numbers tell us it is time to buy. Before it increases by leaps and bounds as predicted.” — Keeping Current Matters