With the price of a home being up right now and rent prices also being up, you might be questioning if its better to buy or rent. Julie and Daniel Desrochers of Desrochers Realty Group and EXP Realty think that even though it is a sellers market, it may still be a good time to purchase a home.
Some of the “Pro’s” include:
- Interest rates are low and rental prices are high.
- In most instances your monthly payment will be lower if you purchase a home compared to renting.
- With rental prices rising you cannot anticipate your costs over the long term.
Tax benefits & Building Equity
- You may be able to deduct your mortgage interest and property taxes.
- You do not get those benefits if you are renting.
- Depending on how long you stay in a home you could be building equity. Your mortgage payment is going towards paying off the house and if the market goes up you are gaining equity.
- When you are renting your helping to pay someone else’s mortgage, why not build equity for yourself
Customizing your Living space
- In a rental there is not a lot you can do to update or change the property
- Most landlords will not let you paint cabinetry or add a new patio in the backyard
- If they do allow it you are just improving a property that you do not own and will not benefit from, from an equity standpoint.
However, some of the “Con’s” of buying include:
You change locales of living a lot
- Should be willing to be there at least 2 to 3 years, maybe even 5.
- If you move a lot for work or change jobs often, purchasing may not be the best idea.
- It could cost you money to have to sell your house after only living there for a year or two. As you will have costs to sell and move.
- With more people working from home though we may see people not moving around as much as commuting to work is no longer a factor.
You have a hard time saving and keeping an emergency fund
- There is more maintenance and periodic expenses that pop up when owning a home.
- Need to be able to put aside money to pay for those things.
- Example: The water heater or furnace goes out, those things need to be paid for right away so you need the cash on hand.
- You also need the time for maintenance, like mowing your lawn or snowplowing or need to be able to afford to hire those things out.
* Something to consider – If you don’t want to deal with some of the maintenance issues or costs of owning a home purchase a townhouse or condo. The association dues you would pay go towards taking care of some of those things.