Tuesday, May 26, 2009
Renting vs. Owning
So, you've never owned a home before, but for the first time, you're actually considering stepping out on that limb and taking the plunge into owning a home. Congratulations! You've come pretty far.
I remember the first time I bought a home. I thought my credit wasn't that great and I worried about paying more than 7.5% interest. When we finally decided to put down roots in Jacksonville, Florida, our mortgage lender pulled our credit 'just to see what it was'. We actually had nothing to worry about. And with that, we took the plunge into buying our first home.
Rest assured. Owning a home, while nail-biting and exciting, is a great investment. While lenders are scrutinizing mortgage loan applications a little closer, even those with a 620 credit score may still qualify for a mortgage.
To help you make a decision about whether 'to buy' or 'not to buy', here are a few comparisons between owning and renting:
- Tax benefits of ownership are available for monies spent on interest and other deductions.
- Control of occupancy is assured since you are your own 'landlord'. No one can tell you when you have to move.
- You can accumulate equity over time.
- Appreciation in value is the norm. Owners enjoy increasing values.
- You choose the decor of your home.
- You reap the benefits from any additions and improvements.
- It's yours! You can have a sense of price in owning your own home.
- You cannot deduct rent payments from income tax.
- You are subject to the landlord's lease and this typically means annual increased rent payments.
- There is no equity accumulation in renting. You are throwing away your money every month.
- Only landlords benefit from appreciation in values - not tenants.
- You live in someone else's decor choices.
- The landlord benefits from any work and improvements you make to the property.
- Your rent does not invest in your future every month.
Well, there you have it - an honest comparison of owning vs. renting. It's very revealing, isn't it?! Are you ready to take that plunge now? Today is a great day to buy. Prices have never been better. Sellers have never been more willing to negotiate. And interest rates are at their all-time low.
If you need help purchasing a home and desire to work with a knowledgeable professional, give me a shout. I'd love to help you take that first step in owning a home.