Most people think that renting is better than buying their own home. But that’s not true at all. People pay more money purchasing a house than they pay for the rent, but they’ll have the value of the house. One of the main reason why potential buyers jump into the market is to build equity or mainly about financial reasons. Also, when you buy your own house, you’ll have more freedom than just renting. Now, here are few reasons why home-ownership is so much better.
The largest source of net worth for consumers or investors is home equity. For first time home owners, you can borrow through home equity line of credit or through a home equity loan. It usually takes a few years for home-ownership to have a greater deal than renting. When you’re renting, you need to keep this in mind that whenever you pay your rent, you’re adding the equity to your landlord’s bank account. You are paying for his mortgage and not yours. Now when you’re buying, your monthly payments are higher, therefore costs more. However, with those payments, you are building the equity in your home. You own the house and you’re keeping what you’re paying for. One of the main rule if you plan to live in your property for at least 5 years is the costs of buying the house are more likely to be out of line by accrued equity and greater housing value. Also, while you’re paying your payments, your home will increase its value. After few years, the equity that you’ve paid for your home plus the increase will usually cover the extra money that you paid to get your home. When we also talk about the interest that you pay each year for the mortgage loan to the bank, this will go down a bit each year. The reason for this is you’re paying interest only on the outstanding debt, thus your debt decreases through the years. Each month a smaller portion of your payment will go to the interest and a higher portion will go towards paying down your debt. Again, equity or home equity is the ownership value built up in a home that regarded as the current market value that can less any still existing mortgage payments. This value is increasing overtime as homeowners pay the mortgage and the market value of the home appreciates.
Deductions mainly about tax, yes, you can deduct mortgage interest and also property mortgage. They don’t give this advantage to renters. Mortgage interest is by far the most beneficial tax benefits. People should be aware that tax benefits could make home-ownership more profitable, because there’s a lot of it. It is possible that home owners who paid on purchasing a home could hold a deduction for any interest that even mortgage taken from one improvement or home maintenance, as long as your home secures mortgage. Government encourage people to purchase their own homes, this could be a very wise decisions for the consumers. People who are wise enough to use these tax advantage will give them benefits that could save them a great deal of money. However, there are many factors that can limit the home owners chance to deduct this interest. Therefore, it is an outright necessity to fully comprehend about tax benefits. It is vital to consult a professional i.e. financial advisor or accountant, to know more about its restrictions and conditions. By far, owning a house can be one of the biggest investments.
If you live in your own home, you will have more freedom. The ability to change everything is unlimited. You can do whatever you want because you’re the owner. You can design and decorate everything in your own home. If you want to add more rooms then do it! If you want to add more floors, or you want to own a pet go for it! It’s your own house. You have all the control. You don’t have this freedom when you’re renting. Renters don’t have the control to upgrade their homes or unit. Creative controls for the renters are very limited. For homeowners, you don’t have to worry that the landlord will increase your rent or ask you to leave for altering something anymore. You can invite lots of people and throw a party in your house without considering the landlords approval or worrying that perhaps your being too loud and the other renters will not get any sleep.
The biggest way to keep and enhance the value of your home is through home maintenance. If you already purchased a home, you are responsible for keeping the entire network running smoothly. You can greatly slim the chance of emergency calling your contractor with some regular maintenance. With regular maintenance, you can increase the value of your home. Houses need maintenance. If you live in your own house, you’ll have to pay for the maintenance or you can do it yourself, or you can pay for someone like a contractor to do it for you. That’s why, you need to comprehend the responsibilities of home-ownership. You also need to understand and know the tools that will help you budget your repairs. There’s a lot of information or advices on how home owners can repair their own houses in the internet nowadays that can be beneficial when it comes to financing or remodeling your house. If you’re renting, the landlord is usually responsible for the maintenance, they could get the maintenance fee from your payments. If you’re handy in your own house, then you could do it yourself without paying someone. And you can spend your money on any other kinds of things than paying for your home maintenance.
Homeowners can do anything they want to their homes. It is also a very good investment and truth be told, we have to live somewhere, where we feel comfortable and at home. It is also said that buying a home is cheaper than renting. For over the past years, home price and mortgage rates have decreased, thus it keeps home-ownership from becoming more costly than renting. As rents have increased drastically, its affordability did not became popular for the renters thus it made home-ownership look cheaper in comparison.