The Advantages and Differences Between Buying and Renting
Buying or renting a place to live is something that none of us avoids having to deal with at one point or another in our lives. Many people dream of owning their own home one day, but buying a house or condominium is not for everyone. Some people choose to rent or lease their whole lives. Even those that qualify to buy a home, have to wait many years usually to own it because of all of the years of financing.
I have my own thoughts on buying and renting as I have done both. There are definite advantages to both. It wasn't easy especially in Southern California because of the cost of living and the price of the homes out there.
Weighing out the pros and cons can help people to decide what is best for their whole family, long term. Its about the biggest ticket item in the budget for most people.
Some of the Advantages to Buying
1. When you buy a home or some other housing, you can know that your payments per month will never go up as in a rental situation. That said though, you need to be prepared for property tax and insurance increases to come along.
2. When its time to do taxes, you get a break when you buy. You can deduct mortgage interest as well as property taxes on your tax return.
3. If the need ever arises, you can borrow against the equity in your home.
4. With buying, over time you build up equity in your home. This is nice because you can sell at a profit, assuming things are going well in the economy.
5. Many have been able to defer taxes on the profit of their home, if they have to sell and buy another house within a two year time period.
6. Sometimes when you buy, you get more living space for your money.
Buying vs Renting Part 1
Some of the advantages to Renting
1. One great benefit to renting is that you don't risk losing your money if housing prices fall when you get ready to sell.
2. When you want to move, you have the freedom to do so, compared to needing to find a buyer if you are selling a home. That can take a long time, and often families are separated and living apart for a time while waiting for things to come together. So a lot less stress there and more freedom.
3. When it comes to repairs and maintenance, you aren't responsible. The landlord will take care of these things usually, and even if they don't and let things get worse, you aren't held responsible.
4. Sometimes, heat and utilities are taken care of or included to some degree in your rental agreement. Depending on where you live, this can be quite a benefit to have.
5. One great thing people find with renting is that their money is often freed up to invest in ways they think are more profitable than investing in a house. If their money was all tied up in mortgage payments, there would be nothing left to invest.
6. If the rent is controlled, this means you can keep your living expenses to a minimum.
* Weighing out the pros and cons can help people to decide what is best
for their whole family, long term. Buying may not be the best thing for all people despite what others may say. It may be the case, in the future.
* Weighing out the pros and cons can help people to decide what is best for their whole family, long term. Its about the biggest ticket item in the budget for most people.