Benefits of owning a home
Buying a home is often the most important, and most expensive, investment you will make during your lifetime. Naturally, prospective home buyers usually devote a considerable amount of time and thought into weighing the pros and cons of buying a home before making such a monumental decision. If you are contemplating a home purchase, understanding the benefits of buying a home versus continuing to rent may help you make a decision that is right for you.
At the top of the list of benefits that home buyers enjoy are a variety of financial advantages. For starters, every month when you make your mortgage payment you know that you are actually investing in your future by building equity in your home. As a renter, your monthly rental payment is effectively doing the same thing, but for your landlord’s future instead of yours. Along with building equity in your home, your home will likely appreciate in value over time, providing an additional financial benefit to purchasing a home. Although factors such as location and the overall real estate market will impact your home’s appreciation, the average home appreciates about three percent a year. Between paying down your mortgage and your home’s appreciation, you can enjoy a significant financial benefit from your home after a few years. On top of the obvious financial benefits that home buyers receive, you will also see a less obvious benefit in your credit score. As you likely know, your credit score is extremely important. If you pay your mortgage on time, your credit score will benefit over time, opening the door to additional investment options in the future. Finally, home owners are also able to deduct interest paid each year on their mortgage, adding yet another financial incentive to buying versus renting.
Along with the financial benefits to buying a home, a home owner also enjoys the ability to personalize his or her home—something that a renter cannot do. As a renter, you can consider yourself lucky if the landlord will allow you to paint the walls. Anything more than that is usually not an option. As a home owner, you can tear down the wall if you want! Owning your home means that you can remodel, redecorate, tear down, or build up at your leisure. The only limits placed on you are structural and budget considerations. As a renter, you are stuck with the home or apartment as is. Decorative touches can help personalize your space while renting, but nothing can take the place of the freedom a home owner has to customize a home. Furthermore, in some markets, buying a home may offer a broader selection of choices than renting. In markets where rentals are scarce, rental prices may actually be higher than a monthly mortgage payment. You may also have fewer choices in a market where the supply of rentals is less than the demand. In this situation, buying a home opens up the market