If you are looking to move into a new home, you might be contemplating whether to rent or to buy a home outright. There are many benefits of owning a home that you should consider. While it usually costs less to rent a home, you will find that renting is not all that it is cracked up to be. Here are 5 reasons why we at Ben Buys Indy Houses prefer owning a home over renting one.
Benefits of Owning a Home
1. Complete Control Of Home
When you have complete ownership of a home, you can do anything you want with it. You are free to remodel any room, buy a solar system, add landscaping, build extensions, remodel a room for kids, purchase a tennis court for the backyard and so on and so forth. You answer to nobody, and you have no landlord that can tell you that these decisions are not allowed.
When you rent a home, you do not even have the authority to re-paint a room. Your landlord has complete say in how the interior and the exterior of the home should look, because when all is said and done, he or she is the home’s owner. This is one of many benefits in owning a home.
2. Benefits For Appreciation
Owning a home is an investment that people can understand easily. This is because they get the lifestyle benefit of living in the house. Financial benefits are also important to consider, and they are known to be more substantial than collecting stocks. A home can appreciate, and when it does, it increases in value; even more so than a stock. This is due to getting appreciation for the homes entire value rather than just an investment in down payments.
For instance, if you buy ten thousand dollars in stock and it appreciates by a few percentage points per year for three years, you are sure to make a couple thousand dollars more in addition to the money that you have invested. If you were to sell, you would pay taxes based on the money gained.
If you buy a home worth a hundred thousand dollars with a down payment of ten thousand dollars, you would make a lot more than just a couple thousand dollars in that same time period. If you were to sell, you would even be exempt from paying taxes from that money gained.
3. Benefits For Taxes
Homeowners are entitled to deduct an interest in mortgage and property taxes when they fill out tax returns each year. The tax deductions that homeowners get for property taxes and mortgage interest can save you hundreds a month in taxes. These savings can actually make owning a home just as affordable, if not cheaper, as renting.
4. Mortgage Costs Do Not Fluctuate
If you get a fixed rate mortgage on the purchase of a home, your mortgage payment won’t even go up or down. Since mortgage expenses make up the majority of a homeowner’s housing payment, this makes his or her budget stable.
When it comes to renting a home, on the other hand, there is always a chance for the price of renting a certain home to go up year by year. If you have rented a home every month for a number of years, there is always the likelihood that you will end up paying more money than what you would pay on a mortgage every month.
When it comes to insurance, there is both insurances for homeowners as well as renters, albeit insurance is not required for renters. Insurance rates can also fluctuate every year. Homeowners insurance can also make fees tax deductible.
5. Forced To Save
If you are a homeowner that is making a mortgage payment, a part of that payment is used to pay down the loan every month. When this occurs, you create more equity for your home. As home equity rises, the amount you pay for a mortgage each month will gradually decrease. The loan paydown for each month is mandatory as a part of the mortgage payment process. While this is a requirement, it is actually a very beneficial thing to be required to do. This is because you are investing more in the home by making more and more monthly payments. In a way, you would be forced to spend money in order to save more later.
When it comes to renting a home, all the money goes to the landlord. The payments you make will not end up benefiting you by any means like how paying mortgage does. This is one of many benefits of owning a home that is very often overlooked.
Owning a home is not as scary as it seems, and you do not need to buy out a home entirely in order for you to own it. Shop for homes to buy with confidence and think twice about renting a home long term. For more advice on home ownership and renting, visit Ben Buys Indy Houses.