At some point in your life, you have to make the big decision whether to buy a home or continue renting. Renting seems like an attractive option with less upfront expenses and the ability to move almost anytime you like. But renting doesn’t give you the opportunity to own your home . If you want to put your money in a long term investment, buying is the way to go.
If you’re on the fence between renting and buying, check out these reasons why buying a home is the smarter option.
Buying is cheaper in the long- term
Paying for monthly rent does not make the property your own. Ultimately, the rent money goes to the landlord’s equity, not yours.
Buying a house can be expensive at the outset. There are costs you need to pay upfront, such as the down payment, appraisal fee, inspection fee, and insurance. But with the right mortgage, the cost of buying can be comparable with renting, and even cheaper in the long run.
You have the freedom to do as you please
When you’re renting, you’re bound by the rules of your lease agreement. You cannot make any permanent or major changes to the house without the landlord’s approval. On the other hand, when you own your home, you enjoy the freedom to plan, renovate, and create your dream home without having to worry about lease contracts and extra fees.
In addition, when renting, you are subject to rent increases and eviction notices. Buying a home gives you peace of mind and security that you don’t have to move because of factors you can’t control.
It motivates you to save
Saving for the down payment is necessary when buying a home. This can help motivate you to save and get your finances in order. Homeowners know that it takes the right discipline to save for the down payment and monthly amortization.
Buying your own home shifts your focus from saving and budgeting to pay the monthly rent – which is essentially money down the drain – to saving for an asset that can bring you good returns in the future.
You’re building your wealth
Having your own house is more than having a place to live. It is a smart way of building lifelong wealth because real estate has been proven to appreciate in value over time. In Long Beach, for example, property values have gone up over 100% in the last ten years. If you purchase a property worth $400,000 and its market value appreciates to $440,000, you have already made a 10% return on your investment.
You get more privacy
When you rent a home, there’s little you can do about the landlord dropping in often to check on their tenants. You may also have to deal with loud neighbors, especially when you live in an apartment with thin walls.
Homeownership offers greater privacy. Living in your very own home gives you the exclusive right to grant access to your property. Noisy neighbors? You can soundproof your home, build higher fences, or have a large yard to give you all the space you need to keep nosy neighbors at a distance.
Lowering your living expenses
When you own a home, the idea of living mortgage-free after a number of years is attractive. Once you’ve paid off your mortgage, you free up a large part of your monthly budget and spend the money any way you want. If you’re renting, you will not be able to enjoy this benefit.
You can take out a second mortgage
Your home is an investment. If you run into a medical emergency, or want to make a big purchase, or pay for something substantial, such as your kids’ college education, you can use the equity you’ve accumulated on the home to take out a second mortgage.
However, taking a second mortgage should be done with utmost discretion, as you would be putting your equity as collateral for the loan. The bank can repossess your home if you’re unable to keep up with the payments.
Pride of ownership
Buying a home is a milestone in one’s life. A home that you can call your own and build a lifetime of memories with your family is the fulfillment of a dream for many Americans. Owning a home instills a sense of pride and gives you a feeling of accomplishment. Even 91% of renters agree that owning a home is something to be proud of.
Are you a renter or a first time home buyer looking for home buying tips in Williamsburg, VA? Trust our real estate team at Coldwell Banker Traditions to provide you with the best guidance in finding and buying your dream home.