When trying to decide whether you should rent or own a home, there are many factors to consider. The costs of buying are more complicated than for renting, sometimes making it hard to tell which one is the better choice.
If you have limited funds, don’t have money for a down payment and the additional costs of owning a home (maintenance, taxes, insurance) then renting is the best option. If you are uncertain about your continued employment, and are living paycheck to paycheck, or need to move often, then renting is your best option.
The benefits of renting a home are that you know what the costs will be for the term of the lease, you can move with little costs and there is no maintenance to worry about. However the disadvantages of renting are that you have no tax savings, you have nothing to show for the money you have spent on rent and you can’t make changes to the property.
Buying a home is the best option if you have a stable job, reasonably good credit and you are looking toward your future. And it doesn’t have to cost a fortune to buy a home. There are some loan programs that will allow you to finance a home with no down payment, like VA or USDA loans where you can also finance your closing costs. Sometimes a willing seller can pay some of the buyer’s closing costs so you could feasibly get into a home with very little money.
Generally it is better to buy if you plan to stay in a home more than 5 years. During that time you can often recoup the upfront expenses you paid to purchase the home.
When rent is high in an area, you can often pay much less per month that you would be paying for rent and you will be building up equity in a property that you can sell at a later date. Depending on the state of the economy and your upkeep on the home, your property should appreciation in the value.
Other advantages of owning a home are that if you itemize your federal return and don’t qualify for the alternative minimum tax, you can deduct your mortgage interest and property taxes from your tax obligations.
Websites Realtor.com, Zillow.com and Trulia.com have can give you more information on owning or buying a home complete with rental vs purchase price costs. Or you can ask your local REALTOR© at Azalea Real Estate and take advantage of years of sales and marketing experience.
Visit www.azalearealestate.us to preview homes or contact Aleta Boudreaux at 251-656-4576.
