Despite the improved housing market, fewer people are buying homes and more are choosing to rent. However, buying a home comes with social and economic benefits not available to renters. Here are five advantages to buying a home:
Stable mortgage payments.
Homeowners with a fixed-rate mortgage pay the same interest rate every month, regardless of inflation. Interest rates for renting are steadily rising, while mortgage payments for loans are typically stable. The amount homeowners spend over time can be much less than what renters spend, with the renters paying more per month every year.
2. Significant tax breaks.
The tax breaks available to homeowners make buying a home more affordable. Renters receive no tax benefits; their money goes to a landlord. Homeowner property taxes are tax deductible, and they can deduct their mortgage interest on their federal tax return. These tax savings can make buying a home less expensive than renting in the long run.
3. Potential to build equity.
Buying a home ensures growth in personal wealth. With every mortgage payment, homeowners increase their share in their home’s value. As their home’s value appreciates over time, homeowners can earn a profit off the sale and use that capital toward a home upgrade. Homeowners are building equity and growing their own investment, not their landlord’s.
4. Freedom to customize.
Homeowners have the flexibility to decorate their homes to fit their tastes. They have the freedom to customize and keep pets without restrictions. Homeowners are free to remodel and make improvements that will increase the value of their home. They are also able to take care of home maintenance immediately without having to wait on a landlord.
5. Improved stability.
Buying a home secures a place for a family to grow. Renters are confined by a lease, and run the risk of not being able to renew their rental agreement. Homeowners can stay in one house as long as they like and move when it suites them. Owning a home gives a sense of belonging, and homeowners tend to be more involved in the community.