Buy or Rent Your Next Home?

Let’s explore both renting and buying your home, and see where the real advantages are. 

What are some advantages to renting? Well, you can pick up and move at a moment’s notice – assuming you give the landlord proper notification. To move quickly, though, you may have to spend money to repair the place back to original condition, if you want to get your security deposit back. You also don’t have to worry about most of the maintenance, as the owner gets to pick up that expense. If you’re really lucky, you won’t have to pay for some utilities.

Buying, on the other hand, gives you a number of serious advantages. Most people are unaware that owning a home can be less expensive than renting - and usually gets you money back at the end of the year. In a Forbes.Com article, Trulia chief economist Jed Kolko determined that owning a home is cheaper than renting in all 100 metro areas. That’s impressive.

OK, let’s start with the things you might already know about owning a home. You probably know that equity typically grows over time with home ownership. It’s like having someone pay you for simply owning something. Unless you have art, or precious metals, it’s hard to find something that pays you for owning it.

Additionally, you own the land. Do what you want with it; it’s yours! Even though the mortgage includes it, land is usually valued separately from the house, so you have that as an investment, as well. If you want to add a pool, you get to make that decision, not your landlord. Want an English garden? Go for it!

You have the keys to the castle, so no one is going to get cranky if you paint your kitchen in your favorite color, or decide to install berber carpet throughout the house. Not all considerations are monetary. Sometimes it’s all about freedom to do your own thing.

Now let’s get down to what you might not know about owning a house, and how it pays you.

• Your interest paid on the house is tax deductible.
• Your real estate property tax is tax deductible.
•  Insurance on your property is tax deductible.
•  If you operate a home business from your home, that space is also tax deductible.

Since most of your starting payments, and for about 10 years afterward, are interest heavy, you will have quite the deduction. Add your insurance and property tax to your deductible, and you have a sizable little bit of money coming back at the end of the year. This isn’t going to happen when you pay rent.

Another nice benefit, if you meet the requirements, is that you can avoid the capital gains taxes when you sell your home. That can make for a sizable chunk of change.

So, what’s stopping you from getting a home? In most cases it’s a lack of knowledge about the benefits, or a lack of down payment. In some cases it’s a credit score keeping someone out of the market.

What if someone told you that there were loans where you could finance the down payment? And even if your credit is bad, there are ways to raise your credit score, by both your doing and with outside help, to a point where you could buy a house.

There are real estate companies that can help with some of these things, but Shaffer Realty can help with all of them. When you’re ready to look for a home, jump to our web site at www.shafferrealtyllc.com or call us at 844-436-2785.