Ready to Buy? The Benefits of Buying Vs. Renting

By Lee Cameron Published 12/3/2009 | Real Estate

In this shaky housing market, many people are opting to rent the homes they live in instead of buying them while they wait to see how the market goes. It's certainly a good idea to stay cautious about such things. After all, buying a home will be one of the most important financial decisions you will ever make in your life. When it finally does come time to decide whether to continue to rent or buy, it's good the know what the advantages are of owning your own home.

Investment - Keep this in mind: when you are renting, it's your landlord that receives every financial benefit from your home. If something is improved or fixed, your landlord benefits. Every rent check you pay, your landlord benefits. All of the equity that gets built up, your landlord benefits. When you own your own home, every improvement that you make on it and any money that you put into it benefits you through increased value and equity. Keep in mind, however, that homes are very risky as short-term investments right now. A lot of people learned this painfully over the last few years. A house should be a long-term investment. It's a good idea not to buy a home unless you plan to live in it for five or six years, at least. Over time, a home is almost guaranteed to be a great investment.

Taxes - Did you know that the cost of your mortgage loan interest is deductible on your income taxes? You can also deduct your real estate taxes. And if you buy a home soon, you might be eligible for the new 8,500 tax credit. That's not just a deduction but an actual tax credit! This can add up to big savings for you.

Independence - The satisfaction from owning your own home is immeasurable. Not only do you get financial independence - no longer at the whim of a landlord and ever-increasing rental payments - but you also have the personal freedom to make your home exactly what you want it to be.

Though there are many advantages to being a home owner, the most important thing is that you feel at home where you're living. A rental property can be a great home just as much as if you owned it. As long as you feel comfortable and secure in where you live then you must be doing something right. But if you're ready for a change, make sure that you know where to look and who to ask to get the best information available.