I graduated from college a few years ago and have a job I love. I’ve been renting a townhome and need to renew my lease. In so doing, I was told my rent is going to go up $100/month. This got me thinking about buying a place. I’m wondering what you suggest I do.
Your experience of your rent going up is typical of what renters are finding these days. While home prices continue to remain low, rents are rising. So purchasing a home seems to make sense.
Consider the following advantages to homeownership:
1 – Money matters – You can pay the same monthly payment, or even less, while often building equity (the difference in how much the home is worth over how much you owe on it). In addition, your mortgage interest and property taxes can be deducted on your federal tax returns. Also, in paying your mortgage each month you are routinely putting money away, forcing you to save. This especially makes sense now when interest rates are low.
2 – Security and control – By living in your own home, no landlord can kick you out or raise your rent. You can remove walls, remodel and make repairs without anyone’s permission. Of course, you own the home so this is at your expense.
3 – Stability – A home you own provides a permanent place where you can live and grow. This promotes a sense of community which encourages involvement to better your neighborhood.
Although these are good reasons to buy a home, if you see your job as short term or you are not sure you want to stay in the area (at least 5 years), renting is your better option.
If you’re convinced home ownership is worth looking into, contact your local realtor who will guide you through the process. Most likely you will find yourself a home owner and happier for it.