Buying a Home – Can Renting Be More Expensive Than Buying a House?
If you’re a renter, how often have you considered if home ownership may be more cost effective for your budget? Many renters struggle with this dilemma, undecided about which alternative would make better financial sense. Many renters suffer with the inconveniences of renting, yet they’re afraid to pursue the option of home ownership because they believe the misconception buying a home will be more costly than renting. Unfortunately, what reinforces this pessimistic attitude is a bustling real estate market when home prices spiral upward.
As you read this article, you’ll learn about some important homeownership facts that will give you hope to pursue buying your own home. After considering the benefits of personal freedom, tax benefits, future increases in rent, and the ability to make money through home equity, you’ll be amazed to find out owning a home can be cost effective in the long run. If you really take the time to figure out the thousands of dollars in lost equity you could have saved, you’ll jump at the first opportunity to buy a home.
After you buy a house, the government allows you to reduce your taxable income by subtracting a large portion of your mortgage payment. In reality, your overall homeownership costs can be reduced – contingent on your individual Federal, state, and local marginal income tax rate (MTR). The amount you save could range between 20 to 40% of your monthly mortgage statement.
Let’s see how affordable home ownership can be-let’s say you have a monthly mortgage payment of $2000 (which includes principal, interest, property taxes, and insurance). After calculating all tax deductions, your final mortgage payment could end up around for $1400 each month. While your real savings will vary with your personal conditions, it’s important to know buying a home can be more cost effective than renting. To properly evaluate your financial circumstances, seek the guidance of a season tax attorney, accountant, or mortgage agent. After speaking with a professional, you may just decide owning a home is right for you.
When you graduate to the position of the homeowner, not only do you gain financially, but you get to experience the joys of individual freedom. Think about how wonderful life would be without a controlling landlord telling you who can visit your home or what pets you can keep.
If you were to consult with former renters, the benefits of owning a home far outweigh the sacrifices needed to make it happen. It’s difficult to put the price on the benefits of individual freedom and home stability when you become a property owner.
When you first evaluate the monthly expenses of ownership, it may appear to be more costly than renting. This trend tends to be applicable in areas where land costs are high. Don’t be discouraged if this should happen. You need to remember the financial gains of being a homeowner accrue over time. Over time, you can save thousands of dollars with your own home.
One important feature of ownership is the capability of amassing thousands of dollars over time. Even if the home market fluctuate up and down, homeowners still tend to profit more financially from increased home equity than someone who rents.
Learn more about Tustin homes for sale. Use these local Tustin Realtors and see what they can do for you.
Author: Sarah P. Shimanski
Article Source: EzineArticles.com
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