Still Writing Checks to the Landlord?

Still Writing Checks to the Landlord?

Home loan payments are now often less than paying rent!

Renting can make good sense – for those that don’t intend to stay in their home for long, need extra mobility or have highly uncertain employment prospects.

If you’re planning on sticking around – there are several very solid reasons why owning can prove to be more rewarding. 

 Rates are at Historic Lows – and if that weren’t already enough, prices are low too. This is an unusual and probably once in a lifetime combination. Together, the real cost of purchasing a home is less than it’s been at any time in about the last 50 years.

 Buying Builds Equity – on most mortgage loans you pay down the principal balance with each payment. This typically starts at about $100 per month for every $100,000 of loan balance and increase each month through the entire life of the loan.

To do an accurate rent vs. own comparison, you must subtract the principal paid each month from your total loan payment. Even if purchasing happened to be more than renting, this alone will often tip the scales back in the other direction.

 Appreciation – It’s no secret that we haven’t seen much of this lately and there’s no guarantee either. However, if we use history as a guide, values have typically risen at a pace above inflation and as long as there is only so much land and ever more people, demand will rise and values will go up.

Housing is a precious and necessary commodity that we all need every day. It’s our choice to rent or to own, yet buying one for yourself usually beats buying one for the landlord.

 Tax Benefits – Not everyone is going to benefit from this. Unless you have a sufficient basis to warrant “itemizing” on your taxes, it can be better to just take advantage of the standard deduction. However, the home mortgage and real estate tax benefits can be two of the most valuable items in the tax code for individuals.

Many homeowners save many thousands every year with these deductions. To learn how that might apply to you, it’s best to consult with your tax pro for personalized advice.

 Personal Reasons - Home ownership can mean different things to different people yet most cite the many benefits beyond just the financial.

Becoming rooted in a neighborhood, school district or community, having the freedom and privacy to do what you want or to make modifications to your property as you please are all factors that can formulate the most valuable returns.

If you want to learn more or find out what you might be able to qualify for, reach out anytime. The door is always open.