What are the benefits of owning a home rather than renting one? I’ll go over five of the main financial benefits today.
Why should you buy a home instead of renting one? There are five main reasons why.
First of all, when you own a home, you get a lot of tax benefits. Thanks to the mortgage interest deduction and being able to deduct your property taxes, you keep more money in your pocket when you own your home than when you rent.
You also have a forced savings account. You save money each month because you put money into your house instead of paying your landlord’s mortgage. Ultimately, you end up with more money to spend over time as opposed to not having any savings at all.
Owning a home also benefits you from an inflation standpoint. As inflation and housing costs go up, your income often stays the same. In those cases, you want to be locked into a low interest rate for your mortgage so that you don’t have to worry about the rising cost of housing in the long run.
“When you own a home, you have a higher net worth.”
When you own a home, your net worth is higher. According to the National Association of Realtors, homeowners are 45 times more wealthy than those who do not own a home or choose to rent. Homeowners build equity. As your home appreciates, you gain value.
Finally, if you are renting a home in today’s market, you are spending just over 30% of your paycheck on housing. When you own a home, you only pay a little over 15% of your paycheck on housing costs. Don’t you want that extra money for vacations or other fun activities?
If you have any questions about becoming a homeowner, just give me a call or send me an email. I would be happy to help you!