Should You Rent or Buy?
In this mortgage matchup, we’ve got two of the biggest challengers of all time going head-to-head. These two housing giants have been competitors for generations, so buckle in and get ready for the show.
First, let’s introduce our competitors. In one corner we’ve got Rent, a payment you make each month to a landlord/management group to live at an apartment or residence. In the other corner we’ve got Buy, an option that allows you to finance a home for yourself.
Who will win? Let’s get right to the action.
Key Point 1
If you’re understandably tired of lining your landlord’s pockets, the ability to build your wealth over time is hugely appealing. Each month, the mortgage you pay is part interest and part principal, with the latter going directly into your home’s equity. Your home equity will grow on a monthly basis and is money you’re pocketing should you sell.
Your wish list for your dream home is as distinctive as your financial situation — no two are identical. Because each aspiring homeowner’s position is unique, many lenders offer a plethora of loan options and will help you navigate until you’ve found the most compatible.
Loud roommates, abrupt rent increases and lack of control are all compelling reasons to make the jump into homeownership and leave renting in the dust. Owning your home gives you independence — whether that be letting your imagination soar when it comes to wall colors or getting a pet now that there is no barrier of a pet deposit. The time for settling is a thing of the past when you become a homeowner!
Even the interest portion of your monthly mortgage reaps you benefits! The fee you pay for borrowing money, the interest, is actually tax deductible. You’re also able to reduce that dreaded tax bill through your property taxes which are also tax deductible.
Across the nation, there is a clear trend of rent spikes. With homeownership, your loan is locked in at a rate while renting statistically increases annually. In 2020, the national median rent(Link opens in a new tab) increased 3.04%.
In addition to the ever-present monthly mortgage, there are other costs associated with homeownership and they’re important to be conscious of.
Key Point 2
Many people, both older and younger, appreciate the freedom renting provides. When you choose to rent, you’re giving up benefits like equity and stability, but you’re gaining in other areas.
Sure, one side seems to favor the other. But there’s no leader in the clubhouse. The winner is whatever you decide to do and whichever benefits you the most, personally and financially. Since you’re here for home buying information, we focused a lot of our attention on explaining certain things in case you’re a first-time home buyer wanting to learn more.
Get your home loan lesson plan
While it may start with an email address, our goal is to secure you a new home address. It’s simple with your personalized Lesson Plan. Every step of your journey is covered so you know what to expect, when to expect it and are always up to date. It’s the perfect place to get started.