Conventional wisdom has dictated that buying a home is always a better bet in the long term than renting it. House prices in the United States have risen rapidly during the past 50 years, making the land owners richer. The financial meltdown of 2007-08 had had a lingering devastating impact on house prices- the prices are still below the peaks reached just before the financial crisis. Despite being lower than the peak, the values have recovered much during the past five years, and they are going to continue increasing. The current financial scenario provides ample reasons to buy a house. Here you will find seven compelling reasons to buy a house:
(1) You are not at the mercy of your landlord
There are neighborhoods where it is cheaper to rent than to buy because monthly mortgage payments are higher than the monthly rent. This makes renting a cheaper option in the short term. In the long term, however, things are different. Your monthly mortgage payments are fixed. This provides some stability to your expenses but your landlord will increase the rent every year (or in between if the agreement says so). His whim can make your monthly budget spin on its head.
(2) It is cheaper to buy
Inflation eats away your mortgage payments and they become more affordable down the years. You may initially struggle to scramble a $600 monthly mortgage payment but after a few years inflation will make $600 a paltry amount to pay for a house. Your rent increases every year so you are unable to benefit from inflation. In fact, it negatively impacts you.
(3) Tax breaks
You save on tax when you buy a house. The federal government offers attractive tax rebates on mortgage interest. You will have to check their website to find out how much you can save on tax.
(4) Financial discipline
The down payment for a typical house is 20 per cent. It means you have to come up with $200,000 to buy a million dollar house. It will take an intense financial discipline to save this amount which is good for your financial health.
(5) Wealth generation
Renters practically burn their money when they pay to the landlord. In contrast, homeowners build equity by paying their mortgage.
(6) Choice and support
There is a huge choice in the housing market for buyers. Renting does not always offer many choices. House buyers get support which the renters cannot. Buyers get tax rebates and excellent counseling options. They can also use an online report to evaluate the current worth of the property. One accurate report can be found at Neighborhood IQ for FREE! And then there are other advantages as well.
(7) It’s yours!
Damn, it is yours! You can paint the roofs yellow, move the walls, and completely redesign the kitchen and bathroom because it is your house. As a tenant, you’d be a lucky guy if your landlord grants you the permission to tweak even a little with his house.
With enough reasons, get prepared to buy your own home. But make sure you check the prices of the house you are going to buy. You can get free home valuation reports at Neighborhood IQ- that will help you create a budget before you spend the money.