The real estate market can be a scary word when you are looking to buy your first home. Yes, renting is safe but can also be a mistake when some cities are a strong buyers market and mortgage rates are at an all time low. Here are five key points why buying is better than renting:
1. A Fixed Mortgage Won’t Go Up…But Your Rent Can:
If you landlord decides to increase your rent after you lease is up, this is something that can be surprising to you and your family but commonly happens. Take a deep breath and a sign of relief because when you get locked into a fixed mortgage as a homeowner, it will not increase. When you pay your mortgage every month, you are able to financially plan around how much is coming out from your payments (wohoo! Time to plan that much needed vacation!). With rates this low, it is the perfect time to take advantage of this!
2. You as a Homeowner Can Walk Away Winning:
Imagine this as an investment into your life and the future of your families. It is a second income stream and when it comes time to sell, you may even get more money back then you put into your home (winning!). If your home appreciates in value, that accumulates as extra cash leveraged on the property and in your wallet.
3. Tax Benefits :
Now that you are a homeowner, you are allowed to deduct property taxes and mortgage interest when they file their taxes every year. These significant savings can make renting the same or even more costly. Even replacing the old appliances in the home for energy star ones can be an added tax deduction.
4. Increase your Equity:
Now this is something you do not get with renting a property. This also increases every year you own the property and if you make any improvements this can also help the equity increase. Based on the amount you earn can help your credit and also get approved for loans.
5. Forces You to Save That Moolah:
Since you have to make your mortgage payments every single month, you will be putting this money back into your home and not into a landlords pocket. If you cut back on lifestyle spending and focus on putting that money into your home…eventually when it comes time to sell and the property is fully paid off…there is a very good chance you will walk away with money.