Saturday, October 31, 2015 / by Jason Huerkamp
Consider Buying vs Renting a Home
There is a tipping point when it becomes more expensive to own than to rent, but according to Forbes a 10.6% interest rate would mean it's cheaper to rent. We have not seen those type of rates ever, yet many people prefer to rent than to own.
If you are considering purchasing a home then Search For Your New Home Now!
When You Rent a Home:
- You have flexibility without the hassle
- You can move to a new home without ever considering how long your property may take to sell
- It's not a concern that you may not sell for what you bought your home for
- Repairs and maintenance are not your issue unless you are reckless with your landlord's investment
- When you outgrow the property - it's easy to move
- You do have to maintain the garden
- More often than not your rental agreement would include you paying the utilities
- If you are a pet owner, there are some fees and deposits payable to the landlord or management company
- You don't have the opportunity to make changes to the property
- You probably have to pay renters insurance
- There are no tax benefits to you renting
- The equity in the property remains with the owner
- The rent keeps rising
- You are the reason the Landlord continues to build wealth
When You Own a Home
- You have to pay for maintenance and upkeep of the property
- The garden may need to be refreshed each season and maintained
- You may have to stay longer in order to build equity in your property
- With great interest rates, your monthly payment could be lower than renting a home of the same caliber
- No pet fees or damage deposits
- There are recurring costs like property taxes and insurance
- Fixed mortgage costs are a bonus in rising rental markets
- Utilities are your responsibility
The Big Picture
In the big picture - there is no right or wrong answer. It's all very personal. Let's break down the lists above to help you with your decision.
If you own a home or rent a home the following items you would probably need to pay anyway
- Garden maintenance
- insurance (be it renters or homeowners)
- a monthly payment against someone's mortgage, be it the landlords or your own
Considering the abovementioned list, if you are going to be living in an area for a reasonable amount of time then it's probably a good idea to own a home. Some of the costs are there regardless of whether you rent or own and with the tax benefit of owning a home, you will find that it is a good idea to become a homeowner.
Owning a home is a responsibility. It is also a joy. It's your own stamp on the world, the little piece of heaven from your work week and it is your safe place to go to.
When you are looking for that home, we the Huerkamp Team understand that feeling. We are here to assist you to make level headed decisions when your emotions are wavering. Our experienced team know the Minneapolis St Paul Areas well and we can help you find your safe place. Call us now - 952-746-9700 or Send Us a Message. We are here for you!