Should You Rent or Buy a Home Based On Today's Economy?
The advantages of buying a home compared to renting a home are abundant. Owning a house, as opposed to renting, is not only benefiting financially, but it also gives you a place to really call home. Obviously, it presents you with the responsibility to maintain your own property, but it also gives you the freedom to do as you wish with the property.
In most cases, the money a landlord spends is comparable to the amount a homeowner spends on a mortgage. However these elements seem incomparable when you consider tax deductions, the many benefits you receive when owning your own home and the real savings offered. A monthly mortgage payment in many cases is fixed during the life of the loan, while your monthly rent may increase at your landlord's will or at minimum along with inflation.
New home buyers should also consider appreciation. Over the life of your home ownership, your new home may appreciate tens of thousands of dollars which will eventually become yours when you sell it. Landlords take a percentage of your monthly rent payment to pay for their own mortgage along with the other expenses that they incur while maintaining the rental.
The Internal Revenue Service allows home owners to deduct mortgage interest, property taxes and some of the other expenses incurred in owning your home. Home owners also have a tax benefit when they sell: current tax law allows, in certain cases, the exclusion from taxable income of up to $250,000 per person in capital gained from the sale of a primary residence.
Know where your down payment will be coming from. Finally, consider getting yourself pre-approved for a mortgage. Most home sellers will take an offer more seriously if they know you have already been pre-approved.
