Rent vs. Buy
There are many things to take into consideration when deciding this question for yourself. In general, most experts widely contend that if you are going to be in the same home for at least five years, the economics of purchasing clearly outweigh any benefits of renting.
Home-ownership provides, above all things, security and pride of ownership! When paying your mortgage, you will have fixed and knowable costs throughout the process. When renting, there is a high likelihood of the rent increasing each and every year. Currently, rental prices in the Boston area are increasing at an average of 10-20% per year with no signs of slowing down anytime soon. When renting you also must keep in mind that the landlord is not under any obligation to renew the lease. According to the terms of the lease, the owner has the right to rent the property to another party or to sell the property at any time.
If you are thinking of purchasing your home, consider the many tax advantages that come along with owning real estate. Ownership gives you the ability to write off property taxes, the interest on your monthly mortgage, and many of the improvements you make to your property. Be sure to consult with your tax adviser to learn about all the benefits of ownership.
On the sales front, now that the economy is improving, local economists are predicting a strong and steady rise in home and condominium prices. Historic low interest rates combined with the huge demand for properties that has been building over the last few years has buyers coming out of the woodwork to make their purchases. This demand will certainly lead to a rapid rise in sales prices. Smart buyers jumping into the game now will surely reap the benefits of rising property values!
Of course, there are some circumstances where renting is the wiser decision. If you are unable to predict what your living situation will be in the near future you must have the flexibility that renting provides. Most leases run for 12 months and it may be possible to sublet for a portion of the lease if your property owner allows it. This adaptability afforded to renting is perhaps the main reason why you would not want to buy a home. Another reason for renting would be if you are unsure of your job security. If your employment situation in the foreseeable future is tenuous then renting may be a better option for you.
When considering whether to buy or rent, make sure to check the sales price trends of homes in the neighborhood you are interested in. If the area seems to be declining in value, you may be better off renting.
Purchasing a property provides fixed monthly payments, the high likelihood of building strong equity as values rise over time, and peace of mind in knowing you are guaranteed to be able to remain in your home as long as you choose, provided of course you maintain your monthly payments. Of all the many benefits of purchasing, the most underestimated tends to be the great pride received from owning your own home. You are making an investment in your future and anything you do to your place will add to your satisfaction of the home and add equity to your investment; the great American dream!
It is said that “everyone in the world has to pay a mortgage.” It is your choice whether you want to pay your own or your landlord’s!