Many people feel that they cannot afford to own a home, they are concerned about the costs of homeownership, but they do not take into account the high cost of renting. While it is true that there is a lot of financial responsibilities while owning a home, there are also several financial benefits.
Every month that you write our your rent check you are essentially paying someone else’s mortgage. By renting you are missing the opportunity of increasing your investment by gaining equity in a home. By renting you are also risking the increase of your monthly housing payment. Any time your lease agreement is due to change you risk that your landlord can increase the rent and fees associated with your rental. By having a fixed mortgage payment you know that your mortgage payment will not be rising, and every month the amount of money you pay toward the principal balance will increase.
While owning a home you also qualify for tax breaks based off of the interest that you are paying on your mortgage. These tax breaks help to assist with the other financial responsibilities of owning a home like homeowners insurance and real estate taxes.
Many families move more often while renting than while owning. Renters move to find a more suitable place for their needs or to avoid rent increases. Overtime this cost of moving adds up substantially between the cost of new security deposits, moving trucks and equipment, and the new furniture that is purchased to accommodate the new place. Renting and moving come at a high premium.
The next time you question the affordability of owning a home take into account the amount of money that is lost in renting. While owning your home at least you are making payments towards your equity and a place that you can call your own.