With the current economy, is it better to buy or rent a home?
Answers | 2
Hi Britt - it's really your personal economy that should determine the answer to that question. What are your financial goals and plans? Ultimately, it's almost always more advantageous to own rather than rent for several reasons. Here are a few: 1) One of the last great tax write-offs afforded to W-2'd employees is getting to write off mortgage interest which lowers your adjusted gross income allowing for less taxes to pay (always speak with a CPA as I am not one), 2) Allows you to improve or build your credit - a mortgage will improve your credit score and show ultimate credit worthiness, 3) Gives you the freedom of home ownership so that you're not beholden to a land-lord's plans or desires (no worries of being kicked out of your home or literally going month to month with the possibility of being kicked out of you pay late or miss a payment), 4) Even though home values are a bit depressed right now (depending on where you live), there is still the possibility of values rising and you can take advantage of the equity in your home in later years to improve your home, invest in other things, etc. and 5) home values are lower and interest rates are low right now - now more than ever is the best time to buy- when prices and interest rates are low!! If you wait until everything 'goes back up', you're going to pay more for the home. Hope this helps. If you want more detailed information, feel free to contact me to provide more details. Good luck.
Hi Britt, Paul hit many of the points to consider. I'd add that you should consider your employment stability, the length of time you plan to live in the area, the chances your housing needs would change (get married, have kids, etc), your history of handling credit responsibly, and your attitude towards the many tasks associated with home ownership. Owning a home is a substantial financial obligation, and just as much a commitment to time/effort for maintaining the home. It's important to remember both sides of that discussion. Hope that helps, let me know, I write loans nationally, always glad to help.