“Should I rent or buy a house?” This is a question that everyone eventually asks themselves. If you haven’t found your answer yet, we’ve put together a few reasons as to why buying a house can be a good financial investment compared to renting.
Length of Time
When considering buying a home you have to determine how long you foresee yourself in that area. If you don’t believe you’ll be in that area for 5 to 10 years then purchasing a house there is not the best route for you. To be considered a good investment, purchasing a home comes with the need for a certain amount of time to pass by in order to actually see a profit or break even with your purchase price.
This may not always be the case, however. If you plan to update or improve the property, you will most likely increase the value of the home therefore, increasing your return on investment.
Purchasing a home comes with many benefits. Some of which include the ability to borrow against your home in the need of an emergency or selling the home for additional income. Not only can having a home become beneficial during retirement, it also allows you to improve your credit score with monthly mortgage payments.
An improved credit score makes it easier for you to obtain additional means of financing.
Another perk of owning your own home is the ability for it to reduce your income tax bill. You can potentially see a few thousand dollars in tax savings each year with the help of your mortgage interest and property taxes being deducted from your income.
It’s not uncommon for people to be stuck between the tough choice of renting vs buying a home. Buying a home is a huge financial commitment and may not be right for everyone. However, if it is in fact in your budget, you can save yourself a ton of money.
Renting comes with a few downsides such as less square footage, little to no ability to make the space your own, and paying for someone else to own the property. While renting can be a great short-term option, if you are considering a more long-term placement, searching the current housing market is where you should head next.
Not only can purchasing a home provide you with financial benefits but it also helps psychologically. The pride of owning your own home and being able to truly make it your own is highly satisfying. With the ability to do as you please with your property, your options are nearly limitless with what your home can become for you and your family.