Owning a home has great financial benefits, yet many continue renting! Today, let’s look at the financial reasons why owning a home of your own has been a part of the American Dream for as long as America has existed.
“With Rents continuing to climb and interest rates staying low, many renters find themselves gazing over the homeownership fence and wondering if the grass really is greener. Leaving aside, for the moment, the difficulties of saving for a down payment, let’s focus on the monthly expenses of owning a home: it turns out thatrenters currently paying the median rent in many markets could afford to buy a higher-quality propertythan the typical (read: median-valued) homewithout increasing their monthly expenses.”
What proof exists that owning is financially better than renting?
1. ThelatestRent Vs. Buy ReportfromTruliapointed out the top 5 financial benefits of homeownership:
Mortgage payments can be fixed while rents go up.
Equity in your home can be a financial resource later.
You can build wealth without paying capital gain.
A mortgage can act as a forced savings account
Overall, homeowners can enjoy greater wealth growth than renters.
2. Studieshave shown that a homeowner’s net worth is 45x greater than that of a renter.
3. Just a few months ago, we explainedthat a family buying an average priced home at the beginning of 2017 could build more than $42,000 in family wealth over the next five years.
4. Some argue that renting eliminates the cost of taxes and home repairs, but every potential renter must realize that all the expenses the landlord incurs are already baked into therent payment–along with a profit margin!!
Owning a home has always been, and will always be, better from a financial standpoint than renting.
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