In South Carolina and throughout the country, phrases like “down payment” and “closing costs” scare people. In fact, some folks are so leery of these terms that they decide to rent their homes rather than become homeowners. Considering the current economy, it can be challenging to make ends meet, not to mention trying to achieve long-term financial stability. You might be surprised to learn that, in many cases, it makes better sense to buy a house rather than rent.
People typically think of the amount of money that is leaving their pockets each month when considering whether to buy a house or rent. While it’s true that paying rent to a landlord is usually a lot less expensive than making a mortgage payment, there are other issues to consider that might make buying versus renting more attractive.
Buy a house and say good-bye to renting
The following list includes several reasons why it’s often better to buy a house than to be a tenant:
- Monthly rent lasts forever, while mortgage payments come to an end.
- Homeowners (at least, those who do not have an HOA) do not have to ask permission to do things like get a pet, upgrade fixtures, install a backyard pool, etc.
- Rent often increases, but a fixed mortgage rate does not.
- There are tax deductions available for homeowners that are not available for people who rent their homes.
Paying off your mortgage loan means that you’ll own your home. Someone else owns your home if you pay rent. For most people, the cost-of-living significantly drops when they no longer have a monthly mortgage payment. Owning a home is a substantial asset. This is why, in the long run, it might be better to buy a house than to rent.
Customizing makes a house feel more like home
Many tenants say that one of the downsides of renting a house is that it never truly feels like home because someone else is the owner. As a tenant, you can’t paint walls, build an addition, upgrade the landscape, or make any major changes without the landlord’s permission. When you’re able to customize your living space, it feels like home.
In some situations, the ability to customize might help you save money, as well. For instance, you might decide to install solar panels or other modern appliances or technology that enable your home to be more energy efficient. As a tenant, you might be stuck paying the higher costs if the landlord doesn’t make the changes. The bottom line is that a monthly payment isn’t the only factor that determines how financially reasonable it is to rent versus buy a house. The latter is often the best decision overall.