Should I Rent or Buy a House?

Whether you should rent or buy depends. If your credit is in order, it’s always wise to at least consider purchasing your new home. However, if you have bad credit or credit that needs to be cleaned up, you should rent while clearing up your credit.

Why Purchase When You Can Rent?

Of course, the choice is up to you. There are many reasons to buy a home instead of renting, but when making a decision to rent or buy, you need to do the math. What will your housing bill be if you decided to purchase versus how much you would pay if you decide to rent.

This can’t be the deal breaker, though. Remember that your mortgage, if fixed, will stay that way for 30 to 40 years. Your rent payment will continue to climb as long as rental values continue to climb.

Equity needs to be considered. If you rent, you will be paying into your landlord’s equity. Pure and simple, if the equity increases on that home, your landlord will benefit, and to be fair they should. They have been paying the mortgage payments, taxes, and insurance. However, if you own the home, it’s a different story. You will be paying into your own equity.

How about home improvements? If you rent, any improvements you want to make must be cleared by the landlord. If you own a home, you can pretty much do anything you want to do to the house.

With a mortgage, you might have tax benefits, though you should ask your accountant before purchasing. Regardless of the possible tax benefits, renters cannot deduct any interest rate paid to the landlord as they don’t pay interest – they pay monthly rent.

If you are currently renting and wonder if you might benefit from home ownership, please contact Wathen Realty Group. We can discuss the pros and cons of purchasing a home.