Buying a home is one of the biggest financial decisions you can make. Many people yearn for the day they get to own a home as opposed to renting. However, there are many benefits to renting, just as there are to buying. And depending on your location, renting or owning could help save you money. So how do you know which is better for you?
According to Zillow, it is important to factor in some lifestyles before deciding to own a home. First, let’s look at the different benefits for owning and renting a home. Despite what some might believe, there is an upside to renting.
- Time. You have the option of checking out the location and neighborhood before you buy. Renting gives you the chance to see of you like the area you are living without the commitment of buying a home.
- Career choices. If you are thinking about changing careers to something that may be located in a new town, renting allows you to pick up and move easily without being tied down.
- Income. Paying a mortgage on a home requires stable income. If you expect a change in your income, it may make sense to rent before you buy. The change in income can change your borrowing ability.
- Credit Score. If you are worried about your credit history, renting will help create a history of on-time rental payments. This will help build the good credit you need to qualify for a mortgage.
- Maintenance. Pipes leaking? Toilet overflowing? No problem while renting! Just pick up the phone and call the landlord. Instead of running to the store and having additional money coming out of your wallet, let the maintenance worker take care of it for you.
Of course, when people think about the possibility of buying, the freedom of ownership wins them over. Yes, you will be able to paint the wall any color you can imagine or knock down walls for more space. Plus, there are a variety of additional benefits when choosing to buy a home.
- Equity. Paying rent does not mean you own anything. When you pay a mortgage, you also increase your degree of ownership. You also have the option to borrow against your ownership (or equity) in the home to help pay for major purchases, or you can refinance your home. Once you pay off the mortgage, you have even more equity to borrow against to fund even larger purchases like your dream beach house or your child’s college education.
- Taxes. When you pay mortgage, you can deduct the mortgage interest as well as your property taxes. When it comes time to sell your home, you can keep the first $250,000 in profit, if you are single, and $500,000 if married.
- Maintenance. If the pipes start leaking and toilets overflow in a house, you will get to decide how much to spend and who to hire to fix the problem.
- Renovations. When owning a home, you get to decide how to decorate. Hang as many pictures as you want on the wall, paint them any color you want, or even remove a wall to make space for a larger bathroom or closet! It’s your house!
Take the time to decide whether renting or buying will be better for your current lifestyle before making an impulsive decision. For more information about renting and buying a home, visit www.zillow.com.