How is Buying a House Better Than Renting?
More of than not, buying a house is much better than renting a house; however, that is not always the case. It will depend on your situation and how much your rent actually is. If you have a very low rent price, then renting may be the better-suited option for you. It is also better if you plan on relocating soon. However, without those reasons, it is likely to better to buy a house than to rent one.
There are numerous advantages to buying a house rather than renting one. The best time to purchase a home is when you are ready to settle down; otherwise, if you move in just a couple years after buying a home, you are likely to lose money in the process.
If you buy a home instead of rent a home, and depending on the type of mortgage loan that you take out, your monthly payment will never increase. When you rent a home, you are looking at annual increases of 5% to 8% due to the economy. Therefore, over a period of a few years, if a renter has a rental payment of around $800 and a homeowner has a mortgage payment of approximately $1,000 – who do you think will be better off in the long run? The homeowner will because he or she will not have price increases on their monthly payment.
Now as you can see from the above example, starting out your monthly payment will likely be more, but you can develop equity in your home over time as well as indulge tax savings. Depending on how you build your home, or improvements that you do to your home, you may be able to receive tax reductions/rebates at the end of the year – this is primarily if you “go green.”
When you buy a home, you also of free reign over landscaping, decorating, etc. If you don’t like the colors on the walls, you can change them with no consequences. You can add shrubs, plants, trees, etc. anywhere you want in your yard with no consequences. Anything that you want to do to your home you can with no consequences at all. However, if you were renting, you could lose your deposit or if you signed your lease agreement saying you wouldn’t plant anything in the yard and you do so anyway, you could be evicted from your rental home.
The last advantage that I’m going to discuss today is the safety and security of knowing that one day your payments will end. When you are renting a house, you will have a payment every month for the rest of your life until you decide to purchase a home. If you are buying a home, sure you may have a monthly payment for 10-30 years (depending on your loan term), but the payments will stop in the future at some point.
Although you do have responsibilities when buying a home that you do not have when renting, such as property taxes, maintenance fees, equity loss, and foreclosure, buying a house is much better than renting if you plan on living in the area for quite a while. It allows you to secure a place in the community for you and your family.