Is it Time to Stop Renting and Purchase a Home?
Are you renting a home and wondering if it might make more sense to buy one instead? As mortgage rates continue to remain relatively low, it is proving to be more economical in many cases to purchase a home rather than continue renting. Not only is buying a home an investment in your future, but you will see a tangible return on your money instead of lining your landlord’s pocket.
When considering your options, ask yourself this question: Where do you want to be in three years?
While it may seem like common sense to purchase if you plan to live in the home for ten years and rent if you’re only going to stay for six months, it’s also important to consider the space in-between where these two lines cross. Referred to as the “breakeven horizon,” it is the gray area where consumers must decide the point, in years, at which the accumulated costs of renting exceed the cost of purchasing. A mortgage planner can help you learn more about the breakeven horizon in your area.
Still on the fence about whether to rent or own? Another consideration is that homeowners receive tax benefits that renters do not. A significant portion of the mortgage interest and property tax paid is deductible. Also consider your equity. When you pay rent, you are essentially paying your landlord’s mortgage or adding equity to their bank account. In contrast, when you opt for a mortgage, you increase the amount of equity in your home with every payment.
Call me today to set up a time when we can look at your buying options.