The debate over renting versus owning a home has been going on for quite some time. There are certainly advantages to both, and you should always carefully consider your own financial and life situations before deciding which one is best for you. The following are some of the benefits of owning your own home. They may convince you that owning a home is the way to go.
Your monthly housing payments are an investment for you rather than someone else. Every month that you pay a mortgage payment, you are closer to owning your home outright. Even if you sell your home, you will be able to realize the money you have already invested in the house. On the other hand, rent payments go entirely to the property owner, and you do not reap any profits. When you move out of a rented home, the only money you will possibly receive is your original deposit.
Your housing payments will remain constant. With a fixed interest rate mortgage, your housing payment is stable over the entire life of the loan. You know what to expect every month for fifteen, twenty or thirty years. A variable interest rate mortgage payment will remain the same for a specified amount of time, so you can still have some amount of stability with this type of loan. Rent, however, is likely to increase every single year, even though your housing accommodations stay the same. Your mortgage payment may be more than the average local rental price at the start of your loan period, but there is a good chance it will be substantially less than the average rental price by the time you pay off the mortgage.
Owning a home gives you tax breaks. As a homeowner, you are entitled to savings at tax time. The entire amount of mortgage interest you paid during the year can be deducted, as well as your property taxes. If you secured a mortgage, refinanced your home, or took out a home equity loan during the past year, you can also deduct some of the loan processing fees. Monthly rent payments do not yield any tax advantages.
When you own your home, you can decorate and make changes whenever you want to. If you don’t like the color of your walls, you can paint them. Do you need extra room for the new baby? You can plan an addition to your home. Your home can reflect your own tastes, individuality, and creativity with your selection of curtains, room colors, carpets and wall hangings. Rental properties normally have a list of restrictions regarding changing the dÃ©cor. You will likely need to live with the original paint colors, curtains, and carpet and may be limited to the number of pictures and other wall decorations you can have. If you are able to make changes and upgrades to your rental property, the property owner will be the one to profit from your efforts, not you.