Rent or Buy - You Pay for the House You Occupy

By
Real Estate Agent with RE/MAX Fine Properties

This is a follow up article to my last blog about the benefits of owning vs. renting.

The ironic thing about people who think they can’t afford to buy a home for themselves, end up buying the home for their landlord. There are several facts that support this notion.

In most cases, the mortgage payment including taxes and insurance will be lower than the rent tenants are paying as stated in my previous article.Mortgages, whether held by an owner-occupant or an investor, are usually amortized so that each payment reduces the principal amount owed so that the loan will be repaid totally over the term. A tenant is inadvertently retiring the landlord’s mortgage with his monthly rent.

Renting precludes a person from enjoying the advantage a home has as a leveraged investment. When the borrowed funds cost less than the investment is returning, the rate of return on the down payment grows much faster. As you can see from the chart, a 2% appreciation on a home could result in big returns on the down payment. In most cases, there are very few or no alternative investments that offer a homeowner similar returns.

Even if a buyer agrees with all of these things but doesn’t have the down payment or cannot qualify for a loan, they still need to investigate further since there are currently several down payment grant programs available currently. To find out exactly what types of loans are available and the specific down payment required which can be a whole lot less than 20%, they need to consult with an experienced, trusted loan professional (an Internet lender or a “BIG” bank may not be the best choice.) 

 

For more local information or assistance in listing or purchasing your home, please contact us today at The Gina McKinley Group with RE/MAX Masters. 480-355-8645

 

 

 

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Topic:
Home Buying
Location:
Arizona Maricopa County
Tags:
investing
homebuying
realestate
buyvsrent
remaxmasters
ginamckinley

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Rainmaker
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Pat Champion
Coldwell Banker Camelot Realty - Mount Dora, FL
Call the "CHAMPION" for all your real estate needs

Great post buying a home has it advantages; of course, every situation is not the same it is up to the individual to decide if buying is better than renting. Thanks for sharing I hope you have a great afternoon.

Jan 17, 2017 11:18 AM #1
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Rainmaker
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Gina McKinley

ABR, CIAS, CDPE, CRS, SFR -Chandler, Gilbert, Mesa
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