Looking for a new place to call home can often feel overwhelming. The decision-making process can be filled with uncertainties and questions, with one of the biggest being, "Is it time to transition from renting to owning a home?"
It's a valid question. Before making a decision, it's crucial to evaluate which option aligns best with your current circumstances. While there are various factors to consider, your purchasing power should be a key influencer in your choice.
For many individuals, the financial benefits of homeownership outweigh those of renting. Additionally, owning a home can offer numerous lifestyle advantages. Here are some of the top reasons why individuals opt to buy rather than rent.
Building equity through homeownership is one of the key benefits of owning a home. As you make mortgage payments, a portion goes towards paying down the principal balance of the loan, which increases your ownership stake in the property. Additionally, if the market value of your home appreciates over time, your equity also increases. This accumulated equity can be thought of as a form of savings because it represents the value you have in your home that you can potentially access in the future through methods such as selling the property or taking out a home equity loan.
With a fixed-rate mortgage, your monthly principal and interest payment is set for as long as you keep the loan. Sign a rental lease, however, and you could see your rent rise the following year or in perpetuity.
As of 2023, when you sell your primary residence, you can avoid capital gains tax on a profit of $250,000 (or $500,000 for married couples). Learn more on IRS.gov and contact your tax professional for more details.
Homeownership goes hand-in-hand with voting, school volunteering, and general civic roots. If you own a home, you may be more likely to put roots down and connect with the people in your community.
While renting can often feel like a temporary arrangement, owning a home brings a sense of pride and accomplishment. There is something special about knowing that you have a place to call your own, a space where you can truly make your mark and create lasting memories. This sense of ownership and belonging can foster a deeper connection to your home and community, making it more than just a place to live, but a true sanctuary where you can thrive.
If you’re looking to buy a home, contact me today. I’ll work with you to see what you can afford and help you run the numbers regarding your particular rent versus buy scenario. Don’t get scared off listening to the news about interest rates. There are creative ways that mortgage companies can bring the rate down.
These tips and many more can be found in our book, The Essential Handbook for Buying Your Home. For a free, no-obligation copy please contact us here or give us a call at 775-525-0309.
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*Please contact your tax professionals for the latest tax laws. Tax benefits are always subject to change.