Your parents and friends have probably already told you that the benefits of owning a home far outweigh the savings that you get from renting. In today’s market, with interest rates at near historic lows, it can actually be cheaper to buy a home!
How can that be? Well, Trulia’s survey showed that purchasing a home was 23 percent cheaper than renting in America’s top 100 real estate markets in 2015. Even after that, interest rates have dropped, and probably won’t start to rise until at least December, due to the fed not wanting to influence elections.
When you look at the costs associated with buying a home, a down payment, brokers fees, closing costs and more, you can find it tough to see where it’s cheaper to own. You often have to lay out anywhere from 3.5% to 25% of the cost of the home up front, making it seem daunting. This makes renting look more appealing, as those upfront costs aren’t included in renting. However, once you pass into the “home ownership” club, you start to see the benefits.
Benefit one is on your taxes. Home ownership can lead to serious tax benefits, often making up such a large chunk that it makes your monthly mortgage payments less than renting at the end of the year. You’re not saving upfront, but on the back end on your tax statement. This more than makes up the difference in monthly payments if you’re patient about your money.
Equity is the other real bonus to home ownership. Renting is just that: renting a space. You don’t own anything. You don’t get any future benefits. Your rent can rise at any time. It’s basically throwing money down a well. When you buy a house, every payment that you make means that you own a little more of your home. It’s YOUR asset. You can sell it, rent it, or refinance it with a cash out refinance to take advantage of the equity that you’ve built. Every payment is a deposit towards your future.
Take advantage of lower mortgage rates to buy a new home and save money. Call us in St. Louis at (314) 781-9700, Chicago at (773) 770-4727, Indianapolis at (317) 550-1515. and Nashville at (615) 810-8555. You can always apply online at www.thehomeloanexpert.com, and we’re also open on Saturdays to better serve you. Don’t forget to follow @TheHomeLoanEx on Twitter for breaking mortgage news and knowledge. Nobody gets lower rates on better loans than The Home Loan Expert, Ryan Kelley, why go anywhere else?