Deciding whether to rent or own a home is a personal choice that requires careful consideration. In order to help you eliminate biases and make the right choice for your unique situation, we’ve listed the benefits of each below:
Benefits of Renting:
- Lower Acquisition Cost. Typically, buyers need an average of 3.5% – 23% of the purchase price for their down payment and closing. Compared to the cost of 1-2 month’s rent, renting is less costly in the short-term.
- Lower Qualification Standards. Though some programs, like FHA loans, have more flexible guidelines, renting requires less invasive paperwork by far.
- Freedom to Move. Renting allows the flexibility for renters to move every year when their lease agreement is up.
- Fewer Maintenance Costs. Renters can rely on their landlord or property manager to quickly fix any maintenance issues they may have. Homeowners, however, are responsible for all costs that go into all home repairs.
Benefits of Owning:
- Personalization. Owning a home gives the owner more freedom to alter their home’s appearance.
- Stability. Rentals can see drastic increases in price due to fluctuations in the market. Owning a home, however, ensures consistent monthly payments.
- Tax Benefits & Savings. Homeowner’s may be eligible for tax deductions on their home mortgage interest, property taxes and origination/discount points for owning a home.
- Appreciation of Property. Historically, home prices have exceeded consumer inflation, even with periods of declining value taken into account.
- Increased Net Worth. According to the Federal Reserve Board of Consumer Finance, the average net worth of renters was just $4,000 compared to that of homeowners worth $184,400.
To learn more about the benefits of renting vs. owning, contact your local VanDyk Mortgage Loan Originator today!