Top 7 Reasons Why Buying is better than Renting

1. Buying doesn’t always cost much more than renting. According to a recent study by the Associated Press, the gap between monthly mortgage payments on a median-priced home and the median rent has decreased from $777 to just $221 in the last three years.

2.  Owning a home is a one of the best ways to build long-term wealth. Historically, a home owner’s net worth has ranged from 31 to 46 times that of a renter.

 3. Buyers can take advantage of tax benefits of home ownership. Perhaps the biggest tax break is reflected in the house payment homeowners make each month. For most, the bulk of that payment goes towards interest. All interest is deductible, unless the amount is more than $1 million. Property taxes are also deductible.

4. Buyers can purchase homes with little or no down payment. Qualified first-time buyers may be eligible for loans insured by the Veterans Administration (VA), which does not require a down payment. Another loan product gaining popularity are those insured by the Federal Housing Administration (FHA), which require only a down payment of 3.5%.

5.  Mortgage rates are at all-time lows. Take advantage of low 30 year fixed rates. We haven’t seen rates this low in the last 3 decades.

6.  Waiting for prices to drop could cost you. A buyer obtaining a 30-year mortgage of $300,000 right now at a 4 percent interest rate will pay approximately $1,431 each month in principal and interest. If that same buyer waits until sale prices drop five percent, he/she runs the risk of interest rates going up. A 30-year mortgage of $285,000 at a 5 percent interest rate will cost the buyer $1,530 per month in principal and interest. Those few percentage points can equate to thousands of dollars over the course of a mortgage

7. It's yours. It feels good to own your own home. After all, you can paint it any color you want, make improvements, and plant a little garden.

 

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